The Enron fiasco was bad enough, followed as it was by the stunning collapse of Arthur Andersen. But I think what pushed things over the edge was the spectacle of ImClone's former CEO being arrested shortly after 6 one morning while he was still in his pajamas. Or maybe it was the indictment of Tyco's former CEO for allegedly evading taxes on his art purchases by, among other things, having empty boxes shipped from New York to New Hampshire.
It was all pretty outrageous, but my outrage had been used up by then. In the wake of Enron and Andersen, there was something almost comical about the ImClone and Tyco affairs. Nevertheless, I couldn't help wondering whether the strange goings-on in the executive suites of large publicly traded companies might actually be doing some real damage.
I don't mean the loss of investor confidence, although that is, and should be, a cause for concern. Rather I began to wonder how the next generation was reacting to the news. You can tell a lot about where a culture is heading by looking at the career plans of bright, ambitious young people. They tend to go where they feel they can have an impact and make a difference. How were their plans being affected by the almost daily revelations about greed, duplicity, and criminal conduct in the business world?
So I conducted a small, unscientific survey of twentysomethings I know, most of whom have spent the past few years searching for their true calling. At various times they have considered careers in government, academia, the not-for-profit world, and law. Recently, one of them told me she had decided to go for her M.B.A.
They were indeed shocked, but not by the business scandals. Instead, they were shocked that I would think such events would have any relevance to them at all. Yes, they had followed the news and found much of it quite entertaining. But it had never even occurred to them that they might alter their career plans because of the vagaries of large publicly traded companies. "What do you expect from those people anyway?" the M.B.A. candidate asked. "And what made you think I would have been interested in what those companies were doing before the scandals?"
Her response had the effect of snapping me back to reality. It didn't take a wave of scandals, I saw, to make young people leery of corporate America. They'd already decided they had better alternatives to choose from.
That's actually part of a broader historical trend. For a long time now, we've been in what I call the centrifugal economy -- that is, an economy that seems to keep pushing people out to the margins. In our grandparents' day, the opposite was true. It was just assumed that, sooner or later, most of us would gravitate to the center. We'd go to work for large companies. We'd get on the corporate ladder. We'd look for promotions and measure our progress in life accordingly.
But all that has changed over the past 20 years. At some point, the traditional goals lost their appeal, and the old milestones became irrelevant. As big companies grew bigger the people who worked for them increasingly looked for escape routes. Almost everybody, it seemed, wanted out.
Of course, the trend was not restricted to the business arena. You could see the same forces at work in politics, religion, philanthropy, and elsewhere. I don't need to remind anyone about the troubles of established churches these days, or the controversies surrounding major not-for-profit organizations like the United Way and the American Red Cross, or the steady attrition of membership in the two major political parties. Wherever you turn, people are looking for choices outside the institutions that were once the pillars of our society.
Scandals just serve to accelerate such trends. In the long run, I suspect, the current wave of business scandals will make entrepreneurship even more attractive than it was before. Small companies are marginal by definition. Margins tend to be characterized by what they lack -- resources and respectability in the case of business.
But margins also offer opportunities to experiment, invent, and create something new. Young people have drawn the appropriate lesson from the tales of corporate malfeasance: if you want to work for a good organization, you may just have to build your own.
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