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Begging To Differ On Daimler -- And Its Pension Plan

While the DaimlerChrysler (DCX) merger may have not yet produced all the benefits everyone had hoped for, it has provided two pivotal ones ("Dark days at Daimler," Cover Story, Aug. 15):

1) Technology sharing: Chrysler's return to profitability has been driven largely by the 300 [sedan], which arguably would not be as successful without sharing components and designs with Mercedes. This opens the door for more sharing, and ultimately better (and globally requisite) economies of scale.

2) Global leadership training: Dieter Zetsche will be a better global leader for DaimlerChrysler as a direct result of his tenure in Michigan. This includes driving a turnaround, understanding the importance of product and marketing, and rapidly adjusting to new environs.

Lincoln Merrihew

Managing Director, Automotive Practice

Compete Inc.


Come on, folks. Your article states that Chrysler's retirees have "saddled" the company with a pension plan that is underfunded. Do bankers "saddle" a company with debt? Do vendors "saddle" a company with invoices? Or do companies make decisions and incur risks to expend resources and incur obligations to obtain needed goods and services?

Bill Tilden

Oakland, Calif.

Re "The debate over doing good" (The Corporation, Aug. 15). One of our key stakeholders is our people, and one of the benefits of contributing to the community is that it helps employees develop leadership skills and business acumen. What we have seen at Deloitte & Touche, which is reinforced by a recent external survey we conducted, is that volunteering offers people a way to develop the required leadership skills needed while also making a contribution to society. The survey revealed a strong link between volunteering and professional success. Among other findings, the data showed that 86% of employed Americans believe volunteering can have a positive impact on their careers; 78% see volunteering as an opportunity to develop business skills, including decision-making, problem-solving, and negotiating. Community service matters.

James H. Quigley, CEO

Deloitte & Touche USA

New York

The view espoused by Milton Friedman and others that the role of business is to generate profits for shareholders is true, but only half the story. Stopping there begs the question: At whose expense are the profits generated? Without a social responsibility "governor," many businesses will externalize major costs of doing business to society at large until government or a group with adequate power steps in to say "enough is enough." Common external costs that were borne by society in the 20th century were health, food supply, and recreational losses associated with dirty air and water created to generate profit for shareholders in industrial enterprises. In the 21st century external costs are associated with global warming and extraction of nonrenewable resources. Businesses enjoy a tacit social license to operate. Any company or industry that jeopardizes that license will see its fortunes tumble.

Neil L. Drobny

Columbus, Ohio

Your article didn't mention the wide range of actions undertaken by Home Depot Inc. (HD) and other businesses to benefit currently serving military personnel and their families. Home Depot has many associates in the U.S. National Guard or the military services' Reserve components. When one of these associates is mobilized for uniformed service -- there are some 1,800 -- Home Depot pays the difference between the associate's salary and his or her military pay. Home Depot also sends volunteer associates to the homes of those deployed to help families with repairs and maintenance and helps military spouses find jobs within the company when a spouse is moved to a new duty station.

Vice Admiral

Norb Ryan Jr., USN (ret.)


Military Officers Association of America

Alexandria, Va.

While General Electric Co. (GE) plans to spend about $800 million more by 2010 on research and development of cleaner technologies, in the same time frame it also plans to increase its revenue by "at least" $10 billion from the same initiative, according to the company. I am sure none of GE's shareholders would mind this kind of return.

Ashutosh Prasad

Plano, Tex.

The connection between corporate social responsibility and the insuring of an improved future workforce is an important byproduct of involvement in improving conditions in central cities. Corporations would do well to include in their strategic planning a section that reads: "We need to reinvigorate our poorer communities so that we will have a competent future workforce that can compete successfully with the Chinese, Indians, etc., in the years to come." To clarify the discussion, let's substitute the term "corporate self-interest" for the words "doing good."

Elmer L. Winter


Editor's note: The writer is past president of Manpower Inc.

It seems at last that the boardrooms and corner offices of Corporate America are waking up to the reality of multiple and often powerful constituencies. Satisfying them entails far more than simply being a big donor or doing good deeds in the community. Who knows? Perhaps this dawning realization will lead to the widespread adoption of a "stakeholder scorecard" as a way for organizations to keep track of how they're doing in relation to their stakeholders. That might give Milton Friedman fits, but it would certainly benefit Corporate America and all of its constituencies.

Fred Nickols

Howard, Ohio

"Ranting at the rating agencies" (Finance, Aug. 15) fails to provide balance for this critical area. The reason behind our Egan-Jones Ratings Co. "ranting" is the failure of the Securities & Exchange Commission to recognize us as a rating firm when 1) we provided warning to investors while the currently recognized rating firms did not, and 2) we are not paid by issuers and therefore do not have a conflict. Fundamental analysis has been and remains the core of our credit analysis (we review security price changes to assess firms' financial flexibility). You should have informed your readers that The McGraw Hill Companies (MHP) financial services unit (which includes Standard & Poor's ratings business) has provided nearly all of your parent company's revenue growth over the past three years and accounts for two-thirds of its operating income of $1.2 billion per year.

Sean Egan

Egan-Jones Ratings Co.

Haverford, Pa.

Editor's note: The first paragraph of the story disclosed that BusinessWeek, like Standard & Poor's, is part of the McGraw-Hill Companies.

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