When Fortune magazine released a list of the world's most admired companies, it got the watchdogs at the Project on Government Oversight thinking there was more to the story. Investigator Neil Gordon did some work and found some of the 'most admired' have a dark side too.
Sharyl Attkisson: This report is called, The Dark Side of the World's Most Admired Companies. What does that mean?
Neil Gordon: Well, it started a few weeks ago when Fortune Magazine released a list of the world's most admired companies. Basically, it ranks the 50 of the world's most admired companies but seen through the prism of financial stability, financial returns for investors. Which we, we felt was pretty misleading, and very one-sided. So what we did, was we took these 50 companies, and we ran the companies through our database of federal contractors. It's called a Federal Contractor Misconduct Database, and another database from another organization that's called the Violation Tracker, and we made a table, we put on our blog. And so the public can see, for each company, their misconduct history.
Sharyl Attkisson: What would you say, in short, that this chart shows us in the big picture?
Neil Gordon: This chart shows that many of the companies that do business with Uncle Sam have histories of misbehavior, which might tend to cast doubt on whether they're responsible to be federal contractors. Whether they're going to perform as promised, they're going to deliver goods and services to the taxpayers, and, and deliver good deals.
Sharyl Attkisson: Are there any rules that prevent the government from continuing to give money and contracts to companies that have had millions of dollars worth of violations?
Neil Gordon: They're really supposed to prescreen contractors thoroughly, to make sure that they have the requisite responsibility.
Sharyl Attkisson: Because it's taxpayer money that we're talking about it.
Neil Gordon: Because it's half a trillion dollars every year of taxpayer money that's being awarded to them.
Sharyl Attkisson: What can you tell me about some of the big and often beloved companies and corporations here in America?
Neil Gordon: Well, some of the companies in the Fortune list have numerous instances of misconduct, companies like Lockheed Martin, for example, has several dozen. Exxon has I think, almost 100 instances of misbehavior, and billions of dollars in penalties.
Sharyl Attkisson: I see Cocoa Cola has 85 violations, Walmart has 235, and Delta has 584. Is this accurate, that Boeing has 1.4 billion dollars worth of fines and penalties they've paid?
Neil Gordon: Yeah, according to our database.
Sharyl Attkisson: I assume Exxon includes the Valdez Oil Spill
Neil Gordon: Right, yeah. Exxon had several violations regarding the oil spill.
Sharyl Attkisson: And maybe JP Morgan Chase probably has violations from the mortgage crisis.
Neil Gordon: Right. Two of the companies, Accenture and Lockheed Martin, were in the news recently for misconduct. They recently settled fraud cases with the federal government. They were accused of over-billing or defrauding the government on contracts, so Accenture I believe, paid 1.7 million dollars to settle that case. Lockheed paid about 4.5 million to settle claims.
Sharyl Attkisson: Stepping back in the big picture, what lesson do you think we've learned from this analysis?
Neil Gordon: Well, just that the public needs to understand that some of the world's most well-known companies are government contractors, which means they take their tax dollars and often have some misbehavior in their background that might sometimes cast doubt on whether they should be entrusted with tax money.
The database the Project on Government Oversight - or POGO - uses is contractormisconduct.org.