Coke & Pepsi take corporate ethics to a new and refreshing level

This week, federal authorities arrested Joya Williams, an administrative assistant to a senior Coke executive, for allegedly attempting to sell Pepsi the recipes for Coke’s new soft drink. Coke and Pepsi, heretofore bitter rivals in the global soft drink market and fierce competitors for your pop dollar, rose above avarice and to set a new standard in corporate ethics. This, coming at a time when the number of corporate ethics scandals seems to be at an all-time high.

In May, Pepsi received a letter at their corporate office offering to sell them Coke’s new recipe. Pepsi responded by calling Coke executives and revealing the plot. Together, officials from the two companies called the FBI and worked with the Bureau to set up a sting operation. The sting resulted in the arrest of three individuals, including the Coke secretary, on May 23’rd. A Pepsi spokesman was quoted as saying, “we were just doing what any responsible company would do. Despite the fierce competition in this industry, it should also be fair.” Meanwhile, Coke CEO Neville Isdell stated that the incident “underscores the responsibility that we each have to be vigilant in protecting our trade secrets.”

Pepsi could have ignored the letter, leaving Coke to deal with a dishonest employee on their own. It would have been easier. But there was much more at stake here than simply a matter of corporate ethics, and executives at both companies recognized it. It might sound cynical to say that both CEO’s recognized the photo op presented in the situation although there might be some truth to it. In fact, both companies, American business icons to say the least, had much to gain by separating themselves from the myriad of other big name companies recently plagued by ethics scandals. Notwithstanding, both CEO’s knew that there was nothing more sacred in business than the secret(s) of each company’s success. Both knew that this was potentially bigger than both of them. Catching and prosecuting the alleged thief was the honorable thing to do. And cooperating in doing so was the only way to accomplish this.

Honesty and dishonesty within any organization begins at the top. An ethical organization does not become so by accident. It takes a determined CEO who makes high ethical standards one of his/her priorities. It has been said that employees only care about what their boss cares about. This is basically true. It’s the filter down theory. But if a CEO is ethically neutral or worse, ethically challenged, the likelihood exists that the rest of the organization will be a breeding ground for impropriety. However, when managers present examples of superior ethical conduct the rest of the organization will get the idea.

Theft of trade secrets is a serious federal crime with stiff consequences. It is investigated at the federal level because the very essence of our nation’s commerce system is at stake. A company’s proprietary intellectual property is what gives it competitive value in the market place.

Companies can help safeguard trade secrets by doing proper background checks on its employees. Credit reports should be part of the package for management employees and employees with audit or accounting responsibilities. For senior executive and board level screenings, federal criminal, SEC, and civil searches should be included. A properly structured exit interview can be instrumental in uncovering ethics problems in any organization. Protection of client lists, suppliers, and other sensitive data can be accomplished through proper controls that restrict internal access to such material. Penetration testing of intranet and internet based systems should be considered as part of your overall security program. Finally, access control systems that provide an audit trail can help secure your building and key internal areas.

There is little doubt that Joya Williams’ attorney will advise her to use the Sandy Berger defense and claim the alleged theft of the Coke recipe was inadvertent; simply an accident of sorts. If you recall, Sandy Berger was caught and prosecuted for stealing documents from the national archives (he stuffed them in his socks). For Berger, it worked. He got off with a misdemeanor charge. But unless Ms. Williams has friends in high places, it is likely she won’t be quite so fortunate. A violation of Section 1832, the Economic Espionage act of 1966, can result in stiff criminal penalties. A person who commits an offense in violation of Section 1832 can be imprisoned up to 10 years and fined up to $500,000.

Store clerk helps thwart terror attack on Army base

In a previous article, "The Soccer Mom's role in protecting our communities from terrorism", I used the term "soccer mom" as an analogy for the average citizen in order to demonstrate how everyone can help in the war against terror. I called for a "special vigilance" at the grassroots level and for citizens in every community to question what they see and what makes them feel uncomfortable and to report suspicious activity. The article spurred a lot of interest, discussion, and quite a bit of scepticism. Perhaps the idea of a soccer mom uncovering a terror cell after dropping her kiddies off at the field was too abstract. Yet, the point had to be made that terror cells live among us and that we cannot rely solely on the intelligence gathering efforts of our government to protect us.

This week the FBI announced that a terror plot to kill soldiers at Fort Dix, New Jersey had been uncovered and thwarted as the result of a tip provided by a clerk at a Circuit City store close to the base. The clerk called authorities after terror suspects requested to have the clerk copy a CD depicting a violent, radical Islamic theme. Had the clerk not been vigilant; had the clerk not been suspicious; had the clerk not cared for his/her community, many Fort Dix soldiers may have died. For all we know (the identity of the clerk has not been released) the clerk may be a full-time soccer mom with a part time job at Circuit City.

As the war against terror unfolds there will be more examples of vigilance such as the one just described. And, over time, what it means to be vigilant will become less obscure. Our vigilance must extend to our workplaces, our social activities, our church activities and our schools. Whether it is a suspiciously parked vehicle, a lone backpack, a suspicious package or letter, a box cutter on a plane, or someone discussing a desire to commit violent acts, we encourage everyone to follow the example of the Circuit City store clerk and report what you've seen.

Unfortunately, this is only the beginning of a long fight against terror on our soil - a fight that will span future generations. Our safety and the safety of our children are at stake, yet, as a citizenry we share a reluctance to get involved. We fear being wrong, offending others, or being called a snitch. Perhaps we've gotten lazy, self centered, or just used to playing the odds. Perhaps political correctness has gotten the best of us. Notwithstanding, it is the time for all good men and women to come to the aid of their communities. Asset Control and ChooseToCare encourages everyone to remain vigilant and to report suspicious or threatening behavior to local or federal authorities.

Asset Control is a full-service security consulting firm. If you think your school or business may be a "soft target", call us today to discuss how we may be able to help make it less so.