Service Learning Activity: Teaching Financial Literacy

 

 

92% of Filipino youth go to public schools. The situation of our public schools is the situation of 92% of our future. Most of them are educated in cramped classrooms with no room to move or no chairs to sit in, or no rooms at all. They don’t mind walking 10kms every day to go to school. Growing up in the city, I truly feel lucky because I don’t have to walk my way to school. I don’t have to swim 200 meters to school every single day. I have a school bus to pick me up, go to our air-conditioned classroom and sit, listen, and learn. I have complete supplies to supplement my schooling. I have complete set of books to read. But having things as simple as pencils, paper, notebooks, clean classrooms – all of these are not simple for the 92%. Having the passion to teach (just as I experienced 4 years ago as I taught in DLSU for 1 trimester), I felt privileged by having the opportunity to make a difference to the public school students through the Cornerstone program.

Cornerstone is one of the education programs of Couples for Christ and CFC ANCOP-Tekton Foundation. Cornerstone mainly focuses on tutoring school children in the public schools in reading and writing, as well as giving Values Formation classes to the parents of these children. Cornerstone volunteers teaches different public school students different levels. And our group was fortunate to be a part of the program and teach Financial Literacy to the top 30 of the grade 9 – 10 batch of Muntinupa National High School. We focused on financial literacy because of two reasons: (1) it’s important to instill the behavior of saving as early as possible to be able to properly discipline themselves as they move on and (2) our group as some knowledge regarding financial literacy that we are willing to share to the students.

I was part of the program committee – designing the outline of the tutorial sessions and the execution of the tutorial itself. Since we only focused on the basics of financial literacy e.g. the importance of saving and tips on how to cut expense, we focused more on examples that they are able to relate with. One example is when I asked them what they will do with Php5,000. I was expecting answers like “buy a cellphone” or “buy shoes or dress”. But it surprised me when most of them answered “iipunin ko po”, “itatabi ko for emergency purposes”, “ibibigay ko sa nanay ko”. When I was 14 years old, all I could ever think of is to have the latest gadget. And it makes me happy that their mindset is the total opposite of mine 10 years ago. I also noticed how attentive they were as we give our lecture. They were taking down notes – even the simplest form of equations like “income – savings = expenses”. It just shows how committed they are to be successful and ultimately help their family rise from poverty.

While our immersion with Cornerstone is short, I know that our program has made an interminable effect to the 30+ students we taught. I definitely feel fulfilled after the program as I know my small part impacted the way they think financially.    

One Step At a Time: Unilever’s Plan Against Environmental Footprint.

Environmental ethics apply ethical thinking to the natural world and the relationship between humans and the earth. Environmental ethics are a key feature of environmental studies, but they have application in many other fields as human society grapples in a more meaningful way with pollution, resource degradation, the threat of extinction, and global climate disruption.

Being part of a giant fast moving consumer goods company that manufactures various products all over the world, Unilever also plays a big role in the environmental footprint. This is why as part of our Compass (sustainable) strategy, our goal is to halve the environmental footprint of the making and use of our products as we grow our business by 2020. This can be achieved by the following:

a.       Halve the greenhouse gas (GHG) impact of our products across the lifecycle by 2020. This can be achieved via renewable energy, new factories, reformulation, reduce energy consumption in offices, and reduce GHG from transport and refrigeration

b.      Halve the water associated with the consumer use of our products by 2020. This can be achieved via producing easy rinse products.

c.       Halve the waste associated with the disposal of our products by 2020. This can be achieved via: zero non-hazardous waste to landfill, reduced and recycle packaging, reduce paper consumption, and eliminating PVC.

d.      Source 100% of agricultural raw materials sustainably by 2020. This can be achieved via: growing food in ways which sustain the soil, minimize water and fertilizer use, protect biodiversity and enhance farmers’ livelihoods.

 

However, meeting those hard targets is not an easy job for the corporation. So far, we are off plan in some of our targets, including the reduction of greenhouse gas impact per consumer use, which has increased by 4% since 2010*.  But as a Unilever employee, I know that I can contribute to meet these targets, even if I’m part of IT. As an IT manager responsible for Unilever’s Transportation Management System, I have to make sure these systems work as accurate and as reliable as expected to ensure efficient transportation of materials and product – which leads to reduced GHG from transportation.

 *This dashboard can be accessed by anyone thru https://www.unilever.com/sustainable-living/the-sustainable-living-plan/

Unilever: A Sustainable Company

Corporate social responsibility—the voluntary commitment of a business that includes triple bottom line actions in its corporate processes—is based on the principle that corporate success and social well-being are interdependent and that the long-term interests of an organization are best served by improving its economic, sociocultural, and environmental/energy practices, also known as the three pillars of sustainability. As a responsible corporation, we respect the interests of our stakeholders—our shareholders, employees, customers, suppliers, and the wider community—and we actively seek out opportunities to improve the environment and to contribute to the well-being of the communities in which we do business. And I am very proud that I’m part of a great company that promotes the triple bottom line not just part of the corporate CSR, but embedded in the vision of the company.

Unilever’s vision is “to double the size of our business, reduce our environmental footprint, and increase our positive social impact”. This perfectly reflects the three pillars of sustainable development: economic development which reflects doubling size of the business, environmental protection which reflects reducing environmental footprint, and social justice which reflects increasing positive social impact as Unilever’s business strategy.

We call our business strategy document ‘the Compass’, since it sets out a constant path for Unilever for the long term. First developed in 2009, it was sharpened in 2012 but its core elements remained the same.

We are developing new business practices that grow our company and communities, meeting people’s ever-increasing desire for more sustainable products and creating a brighter future for everyone.

The Unilever Sustainable Living Program, as part of the Compass, sets out three overarching goals for us to achieve by 2020:

 

By driving sustainability into every corner of our business, the Plan is opening up new opportunities and driving growth. Through innovation and marketing we ensure our products meet social needs and help people live sustainably. The more popular our brands become, the more we grow.

 

The more efficient we are at managing resources such as energy and raw materials, the more we lower our costs and reduce the risks to our business. And this means we have more to invest in sustainable innovation and brands.

 

Working in a company with a purpose of “making sustainable living commonplace” does not only help promote economic, environmental, social responsibility, but it inspires the whole organization, from rank and file employees up to top management, to do manage our responsibilities effectively, because we know that what we do, no matter how small they are, could help achieve the company’s vision. We work to create a better future every day. I’m proud to contribute for a better future. I’m proud to be part of Unilever.

An Organization That Cares

 

Ethical misconducts could not only affect the image of the company, but also its profitability. I have read in an article that JPMorgan Chase paid the federal government $13 billion last fall—the largest corporate settlement in U.S. history—to settle charges involving conduct that prosecutors say contributed to the mortgage meltdown. The bank acknowledged that it made serious misrepresentations to the public about numerous residential mortgage-backed securities.

Ethical lapses tend to snowball. Once employees see others breaking rules without repercussions, they may believe it's OK for them to do so, as well. Or they may get fed up and leave the company. In short, a culture where misconduct is tolerated—or, worse, encouraged—could result in higher turnover, lower productivity and, ultimately, a diminished reputation and profitability. Embezzlement stories are not uncommon especially to big corporations who does not have a strong compliance policy. Though these embezzlement acts, bribes and extortions, insider trading, are all extreme examples, there are also actions and behaviors that compromises workplace ethics. In these cases, management should enforce an organization that is people-centric, promotes respect and integrity, an organization that cares.

A caring organization exhibits better economic performance than mainstream organizations. These caring, multi-stream organizations are focused on the people’s welfare, thus cultivates the full potential of all employees that can lead to maximized company performance and profit. I had an experience once where my manager did not treat his direct reports with dignity and respect. He was leading the team through coercion and force. This did not only affect my, and my colleague’s work perspective, but also affected our self-esteem and eventually, our personal life. This is when I realized that leadership is not all about dictatorship and use of coercion, it’s about inspiring people, especially your direct reports, to do your responsibilities with excellence while preserving integrity and promoting respect.  

Enron: The Smartest Guys in the Room Reaction Paper

Enron was the sixth largest energy company in the world at its height. Claims of over $100B revenues with 20,000 employees, Enron became the seventh largest corporation in America, and represented a new breed of business. But in just a matter of 24 weeks, all accomplishments fell apart as the company filed bankruptcy, employees lost jobs, Enron’s stock dropped rock bottom, and billion dollar pensions disappeared. Is CEO Jeff Skilling the only one to blame? Does Enron’s organizational culture promote such malpractice and unethical culture? If so, is the whole organization accountable for the company’s failure?

There were a lot of issues that contributed to Enron’s downfall. The biggest issues can be summarized into the following:

1.       Accounting Fraud

 

At the top and start of the organization, CEO Jeff Skilling took advantage of accounting loopholes and questionable practices to project to the public increased profits. Just because he had legal go-ahead from the SEC to use mark-to-market accounting, does not mean it was an ethical or advisable thing to do. Mark-to-market accounting allowed Enron to post profit from deals down the road on their current books. One example is that Enron posted a multi-million dollar profit from a deal with Blockbuster Video as soon as they announced it. The deal never materialized, neither did the profits. Although it mark-to-market was legal, Enron’s use of it certainly wasn’t ethical.

Assuming GAAP allowed Enron’s mark-to-market accounting practice and the stock did not fall, it’s still considered unethical because the company was not being transparent about its debt levels, therefore projecting that false image of a healthy balance sheet to the public, that could lead to increased stock prices. The lack of transparency was a problem within the organization since publicly-listed companies are required to disclose accurate financial information. Maximizing profits became the top priority of Enron’s executives, which resulted in dishonesty in disclosing real financial information of the company. Moreover, whistleblowers were being dismissed by managers to protect the name of the company. However, if the company does not intend to commit fraud, Sherron Watkins will be at fault since she has no right to share confidential information without the permission of the organization.

 

2.       Price Manipulation

Energy traders in the organization exploited California’s deregulation of the power market shut down reduce power and raise prices. The documentary shared taped conversations of traders talking about jacking up the prices on “Grandma Millie” just because they could. One trader was recorded calling a power plant and asking them to shut down power for a couple hours. The result: energy prices skyrocketed, rolling blackouts plagued California. They seek out loopholes in California’s energy deregulation regulations to create arbitrage that would push energy prices abnormally high.

Enron’s corporate culture had a tremendous influence on employee’s ethical decision making due to the tremendous imbalance in power in the employer-employee relationship. When there are explicit pressures to achieve sales or profit goals this can promote unethical behavior, over-riding an employee’s intrinsic ethical values or personality characteristics, such as their level of Machiavelliansm, or tendency to manipulate situations for personal gain. In this type of environment—particularly when few checks and balances existed—corporate values were stronger than individual standards. Enron explicitly communicated the message that profit at all costs was the priority.

 

 

Clearly, Enron executives and employees did not live out the motto they were claiming: Respect, Integrity, Communication and Excellence.

 

Based on the information given in the case, Enron’s CEO Jeffrey Skilling and CFO Andrew Fasto should be morally responsible for Enron’s collapse. Together with Arthur Andersen, they set up multiple special purpose entities to hide Enron’s debt levels to the public and made profits out of this practice. They not only misled Enron’s board of directors and audit committee on high-risk accounting practices, but also pressured Andersen to ignore the issues. Arthur Andersen should also be blamed for tolerating and assisting Fastow to this accounting fraud. In addition, they also destroyed documents relating to its partnership with Enron, making this an unethical behavior.

Analyzing the situation using the Markkula framework, the Enron executives and employees decisions are only beneficial from a utilitarianism perspective, as they would have thought about it and never would have predicted their shortcomings. As the CEO would tell their employees, “you just have to make profits and I don’t care how you do it as long as we’re profitable”. This clearly reflects the ideology of utilitarianism, “the end justifies the means”. But Enron only thought about the benefit they will gain from their unethical actions and disregarded looking at the other perspectives: rights & duties, justice & fairness, virtue, and care.

Enron built an organizational culture that focused on profit. It rewarded employees that created profit, regardless of how they did it, with huge bonuses.  And every year, Enron laid off 10-15% of its lowest performers. The culture became aggressive and tough where risky behavior became normative. The documentary states that Enron’s flaw was pride. They truly believed that they were “the smartest guys in the room.” Maybe if they hadn’t been as smart, maybe if they had perceived their shortcomings, they would have foreseen the importance of organizational culture and motivation.

Discrimunation: How Are We Guilty?

 

Here’s what I think: almost all of the business owners have experienced discriminated for and against people at least once. It’s perfectly rational to discriminate between applicants for a job and to only hire those who are the most qualified based on merit. If I’m hiring people in my manufacturing plant, I would most likely hire men - who are more physically capable of lifting heavy objects than women. However, there are irrational and illegitimate forms of discrimination, such as racism and sexism. There is rarely a reason to discriminate against people purely on the basis of religious or political views, sexual orientation, age, or ethnicity.

 

 A blatant example of discrimination could be a policy that women cannot be promoted to supervisory positions because men don’t like to take orders from females. It’s sad but I know a local company that discourages managers and HR to hire gay / lesbian people as part of their sales team. It’s because clients and distributors may find it awkward while talking to them, thus could potentially impact the agent-client relationship! And to think that the corporation has already been operating for 88 years, management must have not taken into consideration the ethics of discrimination.

Discrimination is not only applied to businesses, but also to our human rights as a citizen of our own country / state. In the United States, some states required a literacy test for voters. Many Native Americans were given poor education, thus couldn’t pass the literacy test, therefore not eligible to vote.

When I read about the literacy test for voters, I was guilty of thinking the same way in the Philippines as well. National election is just a few months away, and there’s one aspiring-president that is charged of different corruption anomalies that he couldn’t directly explain why. Many people never wanted him, but some people, especially the masses, still do. And a huge percentage of these masses are the uneducated ones. The aspiring-president is still leading the polls because majority of the population are the masses. It is disappointing because these masses only see the direct benefit they got from the politician: cakes, small discounts, etc. And there was a discussion of only allowing the educated voters and tax payers to vote for the national elections. I was very supportive of that policy until I realized that it’s also a form of discrimination. From a utilitarian perspective, the policy could help the nation to elect the deserving politicians. But from a rights, justice, and fairness perspective, no matter at what angle you look at the situation, it still falls under discrimination – a discrimination to the poor and the uneducated.

Are Advertisements Honest?

 

The field of advertising is extremely broad and diverse. In general terms, of course, an advertisement is simply a public notice meant to convey information and invite patronage or some other response. As that suggests, advertising has two basic purposes: to inform and to persuade, and — while these purposes are distinguishable — both very often are simultaneously present. But is informing and persuading both in line with each other? If you try to persuade, does it mean you inform the consumers the truth? If you inform, does it capture the minds (and the pockets) of the consumers? Not all the time, as I personally think about it.

Advertisers are selective about the values and attitudes to be fostered and encouraged, promoting some while ignoring others. This selectivity gives the lie to the notion that advertising does no more than reflect the surrounding culture. Now let's look at a more subtle shade of truth in an infamous Volvo commercial I read. In a real-life monster truck show, the Volvo was the only car left uncrushed - a great idea for a commercial! But to make the ad, the film company needed to shoot several takes. So they reinforced the beams inside the car to stand repeated squashing. When this came out in the press, Volvo was pilloried and their ad agency got fired, ultimately going out of business. Did it serve them right? Or was it a bum rap? No question the demo was rigged. But what it showed was the truth: if a monster truck runs over you once, you're safer in the Volvo. Is the advertisement itself honest? Technically, yes! Because one take has left the Volvo uncrushed. But how many takes did it take to crush the Volvo? Countless. So is Volvo’s marketing department and ad agency honest? That is for a consumer to decide.

 Advertising in itself is useful tool for sustaining competition by informing people of the availability of rationally desirable new products and services and improvements in existing ones. But Advertising weakens or undermines personal autonomy; that some kinds of advertising are immoral. Advertising plays on human desires for security, acceptance, and self-esteem to influence consumer choices. And as future business leaders, we have to take responsibility in Ethical Advertising. We have to make sure that: we respect truthfulness, the dignity each human person, and social responsibilities.