By Phil Mattera, Dirt Diggers Digest
It would not surprise me if the people who do public relations for
Toyota are flipping through their old scrapbooks to cheer themselves up
amid the worst crisis in the company’s history.
They might be looking longingly at the 2003 Business Week cover story headlined: “Can Anything Stop Toyota: An Inside Look at How It’s Reinventing the Auto Industry.” Or the 2006 New York Times paean entitled “Toyota Shows Big Three How It’s Done.” Perhaps they are going back even further to the 1997 love letter from Fortune: “How Toyota Defies Gravity.”
These days Toyota is instead experiencing the unbearable heaviness
of being exposed as just another unscrupulous automaker that, whether
through incompetence or greed, puts many of its customers behind the
wheel of a deathtrap.
New revelations
that the company knew about the defective gas pedals for years before
taking action are all the more scandalous because Toyota had a
longstanding reputation not only for business prowess but also for
social responsibility.
The company, of course, fostered this image. Its website proclaims:
“Toyota has sought harmony between people, society, and the global
environment, as well as the sustainable development of society, through
manufacturing. Since its foundation, Toyota has continuously worked to
contribute to the sustainable development of society through provision
of innovative and high-quality products and services that lead the
times.”
All big corporations make similar declarations, but Toyota managed
to convince outside observers of its pure heart. Last year the
Ethisphere Institute included the automaker on its list of “the World’s Most Ethical Companies.” Toyota is ranked 14th
on the “Global 100 Most Sustainable Corporations in the World.” And it
received the highest score among automakers in a 2006 CERES assessment of corporate governance changes adopted by large corporations to deal with climate change.
Toyota’s environmental reputation is not completely unblemished. In 2007 the company incurred the wrath
of green groups for its opposition to an effort to toughen fuel economy
standards in the United States (a stance it modified in response to the
pressure). In 2003 Toyota agreed
to pay $34 million to settle U.S. Environmental Protection Agency
charges that it violated the Clean Air Act by selling 2.2 million
vehicles with defective smog-control computers.
Overall, however, Toyota was regarded as a much more environmentally
enlightened company than Detroit’s Big Three. In fact, its successful
efforts to bring hybrids into the auto industry mainstream made it
something of a corporate hero in green circles. Michael Brune, who was
recently named the new executive director of the Sierra Club, brags that he and his wife have been driving a Prius since 2004.
Toyota’s more laudable stances on sustainability issues did not
prevent it from being completely retrograde when it came to respecting
the collective bargaining rights of its U.S. employees. It has
successfully kept unions out of its heavily-subsidized American plants
and has taken advantage of contingent workers to keep down costs in those operations.
Just as good environmental policies do not automatically lead to
good labor practices, the current safety scandal shows that a company
can be green and totally irresponsible at the same time. Despite
Toyota’s claim about promoting “harmony between people, society, and
the global environment,” it appears the company put its business
interests ahead of the safety of its customers and others with whom
they share the road.
The automaker’s safety scandal is another indication that voluntary
corporate social responsibility policies go only so far. It is only
through rigorous government regulation, backed by aggressive
environmental and other public interest activism, that major
corporations can be kept honest.