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Institute of Business Ethics - logoInstitute of Business Ethics - doing business ethically... makes for better business
 
 
 
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Director: Philippa Foster Back OBE

Institute of Business Ethics
24 Greencoat Place
London SW1P 1BE

Charity No. 1084014



   
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Business Ethics News
May 2013
2013  |   Jan   |  Feb   |  Mar   |  Apr   |   May  

Goldman staff to be paid for best behaviour, City AM
24 May 2013

Top investment bank Goldman Sachs has joined the industry’s drive to clean up behaviour and show a more considerate, less greedy side to the sector with a new business standards report published yesterday.

The firm’s reputation took a series of blows following the crisis, including when a former employee published a book alleging Goldman Sachs’ staff called clients "muppets” in internal conversations.


 

 
Apple tax probe helps drive to build consensus on global regime, The FT
23 May 2013


Allegations that Apple avoided billions of dollars of taxes shone a harsh spotlight on the international tax system and pushed Ireland on to the defensive after claims that the company had cut a deal to pay a 2 per cent corporate tax rate.


 

 
Apple ‘pursuing holy grail of tax avoidance’, The Times
21 May 2013


Apple has avoided paying tens of billions of dollars in taxes, using a "highly questionable” web of offshore companies, including subsidiaries that are not based in any nation, a report has claimed.

One subsidiary, Apple Operations International, which was incorporated in Ireland in 1980, has no employees and no offices anywhere, although it keeps bank accounts in the United States.


 

 
Political attacks on tax avoidance could damage Britain, The Telegraph
20 May 2013


Joining some of the UK’s top bosses at a meeting of the Prime Minister’s business advisory council in Downing Street on Monday, CBI president Sir Roger Carr said politically motivated attacks on businesses’ tax arrangements could have damaging "unintended consequences” for Britain.

Mr Cameron should "avoid the moral debate”, he said. "Tax avoidance can not be about morality... Tax should not be viewed as a down payment on social acceptability. Tax should be calculated in keeping with the law of the land.”


 

 
Deaf ear turned to most whistleblowers, The FT
20 May 2013


More than three-quarters of whistleblowers working in financial services are ignored when they first raise concerns to their employers, according to research.

Whistleblowing charity Public Concern at Work publishes a report on Monday showing 77 per cent of financial services whistleblowers are turned away when they tell their employer.


 

 
Royal supplier investigated over ‘mislabelled’ inferior caviar, The Times
20 May 2013


Ready meals contaminated by horsemeat may not have reached the gilded gates of Buckingham Palace, but the latest food scandal may well be cause for concern at the Queen’s table.

 Britain’s largest supplier of caviar is under investigation after one of its most sought-after products was found to be mislabelled as top-grade caviar when it contained a cheaper, inferior type.


 

 
Marks & Spencer under fire over online tax arrangements, The Guardian
19 May 2013


Marks and Spencers has become the latest in a string of UK companies to face criticism from tax campaigners over the way it structures its online sales to Europe – with one describing its sales operation as similar to that of the internet retail giant Amazon.


 

 
Former Google exec says he has 100,000 emails showing how 'immoral' company avoids paying UK tax, The Independent
19 May 2013


A former Google executive-turned-whistleblower says he has 100,000 emails that expose an "immoral” tax avoidance scheme used by his former employer, that has "cheated” British taxpayers out of hundreds of millions of pounds.

 


 

 
Debenhams backs fair treatment of models, The Guardian
19 May 2013


Debenhams has become the first high street retailer to sign up to a new code of conduct for working conditions for models, with the chief executive, Michael Sharp, calling on others to follow suit.


 

 
Ryanair cabin crew have to buy their own £360 uniforms, pay for safety course and are forced to take three months unpaid leave, Daily Mail
17 May 2013

A former member of Ryanair's cabin crew has blown the lid on working conditions for contract staff at the budget carrier. Sophie Growcoot, 20, from Liverpool, worked for the airline after she was employed by Crewlink, a contractor for Ryanair.

Despite her initial excitement at the prospect of working for the major airline, she said working conditions were 'a total nightmare'.


 

 
Rosbank chief faces faces bribery charges after video of ‘raid’, The Times
17 May 2013


One of Russia’s top bankers faces seven years in jail for bribery after investigators released an apparently incriminating film of him standing behind a desk piled with cash.

Russian businessmen expressed doubts about the video and suggested that it was a set-up, but the case has sent shivers of alarm through the financial community in Moscow and reduced already shaky confidence in the investment climate in the country.


 

 
Amazon faces whistleblower's claims over UK business tax practices, The Times
16 May 2013


Amazon is facing mounting questions over the extent of the business activities conducted out of Patriot Court, its headquarters in Slough, threatening to throw the group's controversial UK tax structure into disarray.

A second supplier has contacted the Guardian following an investigation detailing a publisher's claims that certain book-supply contracts were thrashed out by Amazon's buying staff from Slough.


 

 
Google denies misleading Parliament in grilling over tax, The Telegraph
16 May 2013


The Public Accounts Committee cited evidence from whistleblowers who alleged that Google staff in London were much more involved in sales than merely supporting the search giant’s Dublin operation.

It said invoices had been issued from London addresses, payable in sterling to London banks and that London staff earned the more in commission on advertising sales to major British companies than the Irish staff who processed the bills.


 

 
Revealed: Amazon earns more through government grants than it pays in tax, The Independent
16 May 2013


Amazon paid less in UK corporation tax last year than it received in government grants, its official company accounts have revealed – sparking condemnation from MPs around the country.

In the latest example of systematic corporate tax avoidance by a large multinational company operating in the UK, Amazon has revealed that last year it paid just £3.1m in total taxes on sales of £4.2bn.


 

 
New Zealand: SFO wants tougher laws against fraud and bribery
14 May 2013


The Serious Fraud Office is pushing to update New Zealand's 103-year-old law criminalising bribery and is probing a rare complaint of bribes paid to overseas officials by a New Zealand company.

The call came during the New Zealand Institute of Accountants' forensic conference in Auckland yesterday, where insurance industry executives also outlined what they said was a growing problem of fraudulent claims related to the Christchurch earthquakes.


 

 
Whistleblower who said the RSPCA had ruined her life is found hanged at her home, The Times
14 May 2013


A former RSPCA inspector turned whistleblower who accused the charity of ruining her life has been found hanged at her home.

Dawn Aubrey-Ward, 43, spent her final months approaching newspapers to warn that the organisation was killing animals unnecessarily. The RSPCA responded by making public attacks on her character, implying that she was a liar motivated by malice.


 

 
Whistleblowers' claims of wrongdoing being ignored, The Guardian
14 May 2013


Three out of four whistleblowers who raise concerns of wrongdoing at work with their managers have their claims ignored, an analysis of cases has found.

Files of 1,000 workers who approached a whistleblowing helpline for advice also showed that 15% were eventually sacked from their jobs while many others were bullied, ostracised or victimised.


 

 
Petrol price 'rigged for a decade', The Telegraph
14 May 2013


Motorists may have paid thousands of pounds too much for their petrol over the last decade, after two of Britain’s biggest companies were raided on suspicion of manipulating oil prices.


 

 
Wall Street banks see red over Bloomberg’s ‘spy in the office’, The Times
13 May 2013


Executives at some of America’s financial institutions have demanded that Bloomberg News gives details on the type of personal information that reporters could access from data terminals supplied by the company.

Several hedge funds are understood to be seeking urgent meetings with Bloomberg, while the legal department of one of the big banks is examining whether there are grounds for compensation.


 

 
SSE mis-selling 'not as bad as banks', chief executive Ian Marchant claims, The Telegraph
13 May 2013


Ian Marchant, who retires this summer after a decade at the helm, claimed "misunderstanding” rather than lying was behind most of its mis-selling.

The company was fined a record £10.5m by Ofgem last month after a "woeful catalogue of failures by the SSE management” saw prolonged mis-selling, with more than 20,000 households left paying more as a result. SSE has also been convicted in court of mis-selling.


 

 
New Zealand: Whistleblowers welcome at SFO
12 May 2013


When the Serious Fraud Office (SFO) finally called an end to its biggest ever investigation last month, it was up to acting chief executive, Simon McArley, to front the announcement.

 He described the 32-month probe into Hanover Finance as "by far the most extensive and challenging of the finance company investigations undertaken by SFO".


 

 
Ethics cases pile pressure on KPMG, The Times
09 May 2013


KPMG was fighting for its reputation on another front yesterday after Britain’s auditing watchdog opened two separate investigations into its conduct.

The Financial Reporting Council said that it was examining whether an audit partner’s holding of shares in a client had breached ethical rules.



 

 
Investor protests revive memories of shareholder spring, The Guardian
09 May 2013


Shareholders staged protests at a string of company meetings on Thursday, including Aviva, National Express and Tullett Prebon, reviving memories of last year's shareholder spring. A further rebellion could be on the cards on Friday at Ocado which has refused to allow the media in to its annual meeting.

Aviva, which had its pay report voted down at last year's annual meeting and lost its chief executive Andrew Moss days later, failed to stem another revolt with more than 10% voting against its pay polices. One investor stormed the stage where the new management team were sitting waving a banner saying "Aviva are crap", according to reports.


 

 
Bangladesh factory fire puts renewed pressure on clothing firms, The Guardian
09 May 2013

 

 
Whitehall perks: civil servants given bonuses 'just for doing their jobs', The Telegraph
09 May 2013


Civil servants are getting special bonuses worth up to £1,000 each for basic skills such as good typing, first aid, being fire marshals, working from home or travelling to the office by public transport.


 

 
Sun journalists appear in court on bribery charges, BBC
08 May 2013


Two journalists from The Sun newspaper have appeared in court over alleged bribes paid to public officials.

Royal editor Duncan Larcombe and executive editor Fergus Shanahan are accused of conspiracy to commit misconduct in a public office.


 

 
Women still find it hard to smash glass ceiling, The Independent
07 May 2013


Ambitions of being a chief executive? Forget it if you're female.

The average chief executive of a leading British company remains a 53-year-old male with a background in finance, according to the annual Robert Half CEO tracker.


 

 
Ernst & Young: Come clean on corporate tax or face the consequences, The Times
07 May 2013


Big companies have been urged to be more open about their tax affairs if they are to head off legislation that would force them to.

John Dixon, Ernst & Young’s head of tax in Britain, said that companies must respond to demands for greater transparency amid growing public concern over tax avoidance and secrecy. "Doing nothing is not an option. Companies need to do something and they need to do it now.”


 

 
'Thin and beautiful' customers ONLY: How Abercrombie and Fitch doesn't want larger people shopping in its stores
07 May 2013


Abercrombie & Fitch, which doesn't make its womenswear above large, or pants above a size ten, has been accused of purposefully excluding plus-sized customers.

Robin Lewis, co-author of The New Rules of Retail, told Business Insider the retailer's CEO, Mike Jeffries, 'doesn't want larger people shopping in his store, he wants thin and beautiful people.

'He doesn't want his core customers to see people who aren't as hot as them wearing his clothing,' Mr Lewis added. 'People who wear his clothing should feel like they're one of the "cool kids."'


 

 
New Zealand: Chinese inspectors find suspicious 'NZ mutton'
07 May 2013


Shanghai authorities are testing mislabelled "New Zealand" mutton from a wholesaler that a government website said supplies a chain of hot pot restaurants run by American fast food firm Yum Brands.

It is just the latest safety scare to taint China's food industry after separate reports last week that Chinese police had busted a crime ring that had passed off more than $1 million in rat and small mammal meat as mutton.


 

 
Businesses unaware of supply chain risk, The FT
06 May 2013


UK companies are risking serious disruption and reputational damage because they have so little visibility over their supply chains, research has shown.

Businesses in many sectors have little knowledge of where their suppliers are sourcing goods from, according to a poll of procurement managers.


 

 
New Zealand: Fired for leaving 15 minutes early
06 May 2013


A receptionist who was fired after leaving work 15 minutes early will be paid more than $13,000 by the company that dismissed her.

Colleen Mattingly was employed as a senior receptionist at Strata Title Administration from October 2008 until her dismissal in October 2012, an Employment Relations Authority (ERA) finding says.


 

 
Firms rush to relocate in low-tax Britain, The Telegraph
04 May 2013


Steve Varley, the UK chairman of Ernst & Young, revealed that the accountancy firm knew of the significant number of firms seeking to relocate from countries such as the USA, as well as from the Netherlands, Switzerland and Ireland.


 

 
Carillion attacked over subcontractor payments, the FT
03 May 2013


The government is being asked to exclude Carillion from any future construction and private finance initiative contracts on the grounds of its allegedly poor record on payments to subcontractors.

Carillion, which is helping to build the new Crossrail train line, is one of the government’s biggest contractors and on Thursday announced that it had been appointed preferred bidder for the £335m Royal Liverpool hospital public-private partnership project.


 

 
Universities veto adverts for unpaid interns, The Times
03 May 2013


Universities are refusing to advertise unpaid internships amid a growing scandal over the exploitation of job-seeking graduates.

Some of Britain’s leading institutions are refusing to promote the schemes in protest at the inequity of the system. They say it is unfair that graduates are expected to work free for up to a year to break into their chosen career, because only those from rich families can afford to take part.


 

 
BBC bullies 'creating climate of anxiety and fear', The Guardian
02 May 2013


A BBC inquiry set up in the wake of the Jimmy Savile scandal has uncovered widespread allegations of bullying and an inadequate complaints procedure which meant whistleblowers' concerns often went unheeded.


 

 
Clubby London Trading Scene Fostered Libor Rate-Fixing Scandal, WSJ
02 May 2013


Traders and brokers have always enjoyed chummy, symbiotic relationships. But investigations into attempts to manipulate Libor highlight how efforts to curry favor escalated from expense-account meals and nighttime carousing to more legally questionable activities.


 

 
HMRC faces court challenge over Goldman Sachs tax deal, The Telegraph
02 May 2013


The challenge by activist group UK Uncut Legal Action stems from public anger about how big and powerful firms succeed in paying less tax than many ordinary people struggling to cope with a stagnating economy and government spending cuts.

The case concerns a settlement reached in 2010 between Goldman Sachs and HMRC to end a long-running dispute over a now banned tax avoidance scheme involving the payment of bonuses to UK staff via an offshore tax haven.


 

 
Disney safety concerns revealed in aftermath of Bangladesh factory collapse, The Independent
02 May 2013


Executives at Disney were so concerned about labour conditions in Bangladesh that they ordered a halt to operations in the country, before the clothes-factory collapse last week that left more than 400 dead.

The decision to stop production of branded merchandise was taken in March and was prompted, in part, by the factory fire in Bangladesh in November last year that killed more than 120 workers.


 

 
SAC Capital threatens to claw back bonuses, The FT
02 May 2013


SAC Capital, the $15bn hedge fund at the heart of a wide-ranging investigation into insider trading, said it would claw back bonuses for any staff facing regulatory or criminal sanctions.

The move was announced on Thursday by SAC founder Steven Cohen in a letter to investors that was seen by the Financial Times.


 

 
Financial career fails to pay for women, The Times
02 May 2013

Women working in financial services were paid nearly £15,000 less than men last year, according to research. Men earned 20 per cent more base pay than women after experience, qualifications and different occupations had been averaged out, the study showed.

However, 43 per cent of women were happy with their salary, compared with 40 per cent of men, the research by eFinancialCareers found.


 

 
Bribery concerns mount as Rolls-Royce high-flyer quits, The Telegraph
02 May 2013


The high-flyer tipped to be the next chief executive of Rolls-Royce has dramatically quit amid an inquiry into alleged bribery and corruption at the aerospace business he ran.


 

 
New Zealand: Health and safety 'dysfunctional' - union
01 May 2013


New Zealand's health and safety system is "dysfunctional" and needs a major culture change, a union boss warns.

A major independent report released yesterday delivered scathing criticism of New Zealand's workplace safety culture, which it said was "not fit for purpose".

It found that around one in 10 workers were harmed at work in some way every year, with 26,000 injuries resulting in compensation claims.


 

 
Google faces second Parliament grilling on UK tax avoidance, The Independent
01 May 2013


Senior executives from the internet giant Google are to be recalled before MPs to answer allegations that they misled Parliament over their tax affairs.

In November Matt Brittin, Google’s vice-president for Northern Europe, told the Public Accounts Committee that all his company’s sales team were based in Ireland and that the job of its UK staff was merely to market Google as an advertising space.


 

 
 
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