Ask HN: Do you judge business models on morals and ethics?

I have a friend who has said that business ethics classes teach how to justify the answers the teacher (and later boss) wants instead of how to ask the real questions. After all, what you get is a series of hypotheticals and asked what the right thing to do is and why. The hypotheticals are written so it's obvious what the teacher wants. So the goal is to justify the "right" answer.<p>What my friend has argued instead is that the question you are asking, namely how do you evaluate a system? Is it one that encourages the cream to rise, or one where shit floats? To me that's the biggest question.<p>If you have a business model where the unethical individuals rise to the top (and if they are up at the top that's a pretty good bet) then that's a bad system. If you have one that encourages the ethical folks to rise to the top, then you have a good system.<p>Now what would I do?<p>I have worked on projects that others found unethical that I did not, for example, an accounting system for a porn payment gateway. I knew others on the project who did have ethical problems with it. However, the people that ran my customer's business were great--- professional and ethical in terms of running a business.<p>Similarly I had no problem writing documentation for Microsoft regarding interop of Linux and Windows, even though I was helping Microsoft with Windows marketing and I favor Linux for both ethical and more practical reasons. Whatever helps the customer run a mixed environment is ultimately a good thing.<p>On the other hand, there are plenty of projects I wouldn't do even if they seem viable. I don't think Monsanto could pay me enough to do anything for them, for example.<p>As for a next-gen pay-day-loan startup? I would want to have a serious talk with the founders and see if I was missing something. Maybe they have a clear idea on how to make it ethical? Also if I met the founders I might have a better idea if they were being predatory or rather trying to bring a better way for everyone into the industry.<p>For international arms transactions? Hmmm.... given that countries usually buy arms from other countries, that would mostly be to facilitate organized crime. No thank you.<p>If it's a gray area, you sit down and try to get a better sense of things. It is possible for a project to be ethical in a sea of poor ethics. If it is unambiguously unethical, I would not touch it. But if the people running it are clearly ethically impaired, then run like hell.<p>I don't want to be Zinga'd. No thx.... ;-)

That's a tricky question and the heart of the problem with it is that human beings are very good at rationalization.<p>&#62; Would you sign up to hack python for a site that revolutionizes international arms transactions?<p>Yes, I want to help those innocent rebels overthrow that cruel dictator by giving them a means to protect themselves.<p>&#62; Would you design UX for a next-generation pay-day-loan start-up?<p>Yes, what may seem like an extraordinary fee is actually justified by the risk, and many of their customers truly need the service provided. They have no other means.<p>I face this kind of rationalization in my own job. I'm a director at the International Assoc. of Privacy Professionals. My membership, as you can imagine, is very sensitive to what we do with the personal data we collect. So when the marketing guy asks if he can slice and dice the membership data to do some targeting marketing, I have to assess whether the data he is using was collected with proper permission for that use.<p>When we collect data it is with the mission of supporting the privacy profession and should only be used for that purpose or to enhance the value the member receives from us. Now, the marketing guy is a sharp fellow and, as such, he will rationalize that it is to the members' benefit that we accurately execute his plan. He will make a sensible case every single time, almost regardless of the situation. It is what humans are really good at.

Unlike many successful startups* (Zynga, Facebook, etc) I turn down ads for weight-loss scams, mesothelioma, etc all the time. It sucks because there are a lot of them willing to pay. But years from now, I won't remember the cash. I will remember that I contributed to the victimization/extortion of others.<p>As an aside, I see no problem with payday loans, arms dealing, or the like - there is nothing inherently unethical about the businesses. They both offer ample opportunity to cross ethical lines, but that is a choice, not something that is inherent in the business model. It's like Experian - there is nothing wrong with their business - except that they rely on trickery to get people to sign up. There is a difference between an unethical business and a business that is operated in an unethical manner.<p>*Note: I don't believe that the choice to engage in scam advertising is what made these companies successful. I think it is a rationalization of poor behavior on their part.

An interesting new development on this issue is called a “B-Corp.” It stands for benefit corporation, and basically it is a legal designation when a company organizes to have a social mission (things like environmental impact, community involvement, etc.) as part of their fiduciary duty. The result is that a B-Corp can be legally held to its social mission.<p>Relating back to your question, looking for a B-Corp can be helpful for someone looking at the ethics of a business model because a B-Corp is required to have a third party certify that they are actually pursuing their original social mission.<p>If you are evaluating companies in SV, California is one of the states that allow B-Corps, so you should check with the company. Other states (including New York, Maryland, and Virginia) also have allowed B-Corps.<p>Because this idea is so new, it’s hard to say how effective it will be. But hopefully it will be another way to better evaluate a company’s ethics.

My goal in making money is to give money to charity (to fight existential risk; <a href="http://lesswrong.com/lw/8f0/existential_risk/" rel="nofollow">http://lesswrong.com/lw/8f0/existential_risk/</a>). In trolley problem type scenarios where I could kill one person to save four, I would do it. So by the same logic, I'm willing to do stuff with undesirable consequences to make money if the extra money made more than cancels out the undesirable consequences after I donate it to charity.