When I wondered last month how the insurance industry carries on when so many customers have lost faith in it, I had no idea my worst fears would be confirmed so soon. The short answer is that some of them cheat. That's how companies can remain profitable while being despised and mistrusted by so many customers. This was captured piquantly by Vinay Saqi, a Morgan Stanley insurance analyst, who noted insurance companies have had "a difficult time making money when the game is rigged in their favor. We're concerned they won't fare well in a truly competitive environment."
Among the wealth of wrongdoing in this still unfolding story, one fact looms over the rest: Thousands, perhaps tens of thousands, of grown-ups knew about an array of fraudulent practices and failed to shout, "Wrong!" Instead, many regulators, independent watchdogs, brokers, executives in both the retail and commercial sectors, benefits consultants, and investment advisers joined together in a parallel moral universe. Collusion and conformity — "it's not wrong because everyone is doing it" — is accepted. Obedience — "it's not wrong because they told me to do it" — is okay. Opportunism — "it's only wrong if I get caught" — is encouraged. And, of course, narcissism — "it's not wrong if it's good for us" — is celebrated.
This isn't something that will just blow over, even if the insurance industry somehow cleans up its act. As a result of the widespread acceptance of wrong as normal, suspicion now blooms in every encounter. Our children are already on guard. They know that marketing is intended to manipulate their desires, to sell them stuff that pleases while it poisons. Parents try to create a buffer for their kids, but parents can't stand alone; it really does take a village. And our village is being continually degraded by fresh onslaughts of wrong masquerading as normal. Worse, the same parents who are under siege pick up a briefcase, go to work, and participate in it as if they weren't its victims. Who takes the biggest hit when the ship goes down? Ask the 3,000 people tossed overboard by Marsh & McLennan Cos. after the ship's officers got caught drilling holes in the hull, or anyone whose pension was overinvested in Marsh Mac stock.
So what's a village to do? For one thing, we've got to stop relying solely on the rare Eliot Spitzers of the world to carry the entire burden of our social conscience and try to effect change. We all have to share that burden.
The traditional inventory of resources isn't encouraging. As consumers, we're supposed to have spending power. We can withhold our cash from competitors that violate our values and interests. But this isn't effective in an economy where most of the companies in an industry are equally bad (as appears to be the case in the insurance industry).
As employees, we can withhold our talents, labor, and commitment. But without the backup of collective action, we risk being individual martyrs, facing as narrow a range of employment choices as there is for consumption.
Clearly, we need to invent new mechanisms and cultivate new resources for developing and asserting our individual moral authority. Here's a starter kit.
Initiate an online bulletin board to evaluate your own organization and its values in action. Use it to question standard practices, encourage discussion and debate of moral dilemmas, or even expose wrongdoing. Bulletin boards have been used within the eBay community to effectively influence its management. Build on those practices and take them to a new level.
Use Meetup.com or a similar mechanism to start face-to-face discussion groups to share ideas about the best companies to do business with and work for. It's crucial that we support new competitors that are trying to make money while serving our interests and respecting our values. Better yet, use your own values and deep knowledge to start one yourself.
And here's an intimate suggestion: Next time you're poised to participate in a wrong that's cloaked as normal, ask yourself how you'd explain this to your children (even if you don't have any yet). If that doesn't appeal to you, then try what one of my friends advocates. He imagines a front-page New York Times article that chronicles his actions. If it makes him uncomfortable, he knows he's on the wrong path.
Yes, it takes a village. But we have to invent a thousand new ways to rebuild trust, because that's what will make us rich, both financially and in our quality of life. This means facing up to a problem that can't be fixed by regulation or legislation. What's wrong is that nobody seems to know what's wrong anymore. Let's remind them.
Shoshana Zuboff is the coauthor of The Support Economy (Viking, 2002). Join her online discussion.
A version of this article appeared in the January 2005 issue of Fast Company magazine.