Dell seems to be continuing on its downward trend lately. The company’s 2-year stock performance has been somewhat dismal (click on the thumbnail to the right for a large chart [from Yahoo! Finance]), and in an article released yesterday, the New York Times reports that Dell has found evidence of accounting misconduct: Dell Reports It Has Found ‘Misconduct’.

Finance-related scandals are nothing new, especially among once high-flying tech companies, and span a wide spectrum ranging from options backdating, to balance sheet massaging, to pulling fake numbers out of thin air. Dell’s findings, though described with remarkably little detail, seem to point to minor misconduct issues. Perhaps that is because the company is keeping a tight lid on the specifics of their findings, and perhaps it is because nothing major was uncovered during the investigation. Either way, there is far too little information available to investors, or the public, in order to make a clear judgment call on the company’s conduct.

The findings come on the heels of a rather sustained down period at the once mighty company:

“It was once the biggest PC maker in the world, but its computer sales are growing more slowly than those of many competitors. Its chief executive, Kevin B. Rollins, resigned at the end of January, and Michael S. Dell, the founder, returned to office.

“Since then, Mr. Dell has tried to focus a company distracted by disappointing financial results and bad news. He shook up senior management ranks, and has concentrated much of its efforts in China, one of the fastest-growing markets, where Dell’s presence is not as strong as that of Hewlett-Packard or Lenovo.”

Rollins had been groomed for the top spot for years prior to taking the helm, and his departure served a considerable blow to the company and to investor’s confidence. If the financial scandal develops into something larger, Dell may take more than a few years to recover.

…Enter the broader issues. Toward the end of the NY Times article, there is a short passage noting the direct impact the scandal will have on the company’s employees. The news is a bit disturbing:

“The accounting problems, meanwhile, are financially damaging to employees. The company said yesterday that it would have to suspend contributions to the Dell stock fund within its 401(k) plan beginning next month because of its failure to make the necessary financial filings. The suspension affects all employees, a company spokesman said.”

The situation was arguably “messy” prior to the above tidbit. But now all Dell employees see a suspension, of an unspecified duration, of the company’s contribution to the Dell stock fund. What responsibility does the company have to include greater disclosure at this point? How long will the suspension last? What is the nature of the misconduct, and have the responsible parties been removed from their positions? What will the company do to ensure that similar misconduct does not recur in the future? How broad was knowledge of the misconduct? Was Rollins aware of the issue? Was the Board? Was Michael Dell?

I think every Dell employee and shareholder would want the preceding questions, and a host of other ones, answered with the utmost transparency.

TAGS: DELL | Fraud | Ethics | SARBOX | GAAP | Accounting | Corporate Governance

In short, the combination results in a “Whole Trade^TM Guarantee,” or a guarantee of high quality fair trade products (see a recent Whole Foods press release for more info). The guarantee seems like a bit of marketing hype, but should also help push fair trade issues to a broader market. In short, the guarantee should indicate that a product meets the following criteria:

• exceptional product quality,
• more money for producers,
• better wages and working conditions for workers,
• sound environmental production practices that promote biodiversity, and
• support of poverty eradication via donating one percent of product sales to the Whole Planet Foundation^TM.

TAGS: Fair Trade | Whole Trade | Whole Foods | Organic | Coffee | FTC

Continuing with the sustainability theme, here’s an interesting tidbit via ARS Technica about a Google embracing solar power: “It’s Easy Being Green: Google Goes Solar.” I particularly like the idea of using some of the panels as shades in the company’s parking lot. Here’s a clip from the post:

“9,212 Sharp photovoltaic modules now cover the rooftops of the Googleplex, each one capable of pumping out 208W of DC power in full sun. To gain even more solar surface area, Google installed solar panels as “shades” over several of its parking lots, keeping cars cool and generating power at the same time. The installation can generate 30 percent of Google’s peak demand power, or enough to light about 1,000 California homes.”

TAGS: Google | Solar | Sustainability | Sun | Alternative Power | Electricity | Energy | CSR

SustainAbility, Inc. released an interesting report today which, “[demonstrates the] potential for next-generation partnerships to positively impact socio-economic and environmental challenges.” The report, Growing Opportunity: Entrepreneurial Solutions to Insoluble Problems, is available for download on the firm’s website. Though the report is free, you have to register (painlessly fast) in order to complete the download.

I skimmed the report this morning and will give it a thorough run-through later today. So far, however, it looks like a great read. Here is a high-level snapshot of the main findings of the report:

1. Social entrepreneurship is on a roll
2. The potential for breakthrough solutions is considerable – and growing
3. The field is growing, but still relatively small
4. Money remains the main headache
5. Financial self-sufficiency is seen as a real prospect within five years
6. There is a real appetite to partner with business
7. Beware blind spots (risk of over-focus)
8. For real system change, we must focus on government and public policy

More thoughts on the report later…

TAGS: Sustainability | Entrepreneur | Business | CSR | Social Enterprise | Ethics

A press release on Canada News Wire mentions that Honda has been, “honoured (sic) by leading publications in Canada and the U.S. for its environmental and corporate social responsibility.” What I found most interesting about the release was not that Honda was named as one of the ten companies receiving honors, but that Toyota, the often-praised ‘leader’ of the pack in environmentally friendly cars, was not on the list. Odd, eh?

A look at the areas in which Honda excelled might shed some light…

“Honda was recognized for its hybrid technology and fuel-efficient cars, its innovative and sustainable manufacturing facilities, and for its aggressive program to significantly reduce energy consumption at its manufacturing sites. Honda was also recognized for eliminating hazardous substances from its production proves and reducing emissions, material waste and energy use. Honda also scored high for corporate governance and corporate social responsibility.”

Switching out “Honda” with “Toyota” would surely still read accurately, right? I certainly think so, and the vast majority of people that are exposed to positive press about Toyota would most likely agree.

So what is the end result? Are we to assume that Toyota is not actually the hybrid-leader the media likes to present? Should we question the validity of the rating methods used to award Honda a top-ten spot? I think we should adopt both viewpoints but also acknowledge one vary glaring reality–substitute “Chevrolet,” “Ford,” “GM” or most any other major auto manufacturer for “Honda” in the above statement, and it will most certainly feel jarring. If you read the above citation with one of those companies listed instead of Honda, perhaps you would assume that it was a joke, or a typo, or even the result of swaths of money being exchanged by Big Auto and Big Media. I would probably have the same reaction.

The bottom line is that both Honda and Toyota, though they are still far from perfect, are really ahead of the pack. True, there are other auto companies coming up with very innovative solutions regarding fuel efficiency and hybrid or alternative fuel, but they simply lack the mass coverage that Toyota has so far enjoyed.

It is hard not to be cynical of giant corporate CSR efforts, but at the end of the day, maybe a strong effort to push other companies into gear is critical to creating substantial long-term improvements. For now, I say congratulations Honda. Keep up the good work.