Panelists were telling stories Tuesday to illustrate ethical ways to handle business crises when Jack Koraleski began struggling to get his words out.
“People will put safety at risk to get the railroad up and running,” the Union Pacific Corp. CEO said, his voice choked with emotion. “You aren’t supposed to let people lose their lives.”
A Sept. 4 accident killed a Union Pacific worker near Mathis, Texas. Authorities said one man died and another was critically injured when the lift they were using fell over as they were doing some welding on a railroad bridge.
Good business ethics demand that safety is a company’s No. 1 value, and Union Pacific embraces that requirement, Koraleski told about 150 people during a panel discussion for the Omaha Business Ethics Alliance.
“Everything else can be fixed. … You can move mountains if you need to. You can’t replace the people who are affected forever.”
Other panelists at the meeting, held at Gallup’s riverfront campus, recounted other challenging ethical situations.
Linda Lovgren, CEO of Lovgren Marketing Group, said she once advised a judge to make a full public statement about his arrest for drunken driving. The judge admitted his mistake and the incident ended up as a one-day news story with muted consequences, she said.
John Nelson, chairman of the SilverStone Group employee benefits company, said businesses should choose board members with high ethical standards and remove a director who takes unethical actions. Nelson blamed the 2007-09 mortgage meltdown on unethical conduct, starting with bad laws passed by Congress and worsened by lenders who didn’t keep credit standards, borrowers who falsified loan applications, Wall Streeters who sold worthless securities and others motivated only by making money.
The system lacked financial oversight and accountability, Nelson said. “Everybody collaborated on being unethical.”
After the session, Koraleski said Union Pacific has a solid, improving safety record. It had been many months since a fatal accident involving one of the Omaha-based company’s 47,000 employees.
Koraleski said he had hoped to extend that safety record. He became CEO after Jim Young left the post in March 2012 because of a diagnosis of pancreatic cancer. Young remains chairman of the Omaha-based railroad and took part in a recent board of directors meeting held during a train ride on the U.P. system.
Koraleski said the railroad company has a high-level ethics committee designed to keep ethical decision-making a central value of the company’s operations.
He cited a recent bidding process where one party submitted the highest bid to buy a piece of U.P. property, but then a shipping customer offered to match the high bid. The railroad will make the ethical choice of the winning bidder who followed the rules, he said.
Businesses should figure out their risks and plan how they will react to a crisis, he said, realizing that a crisis of some sort is almost inevitable. “If you haven’t prepared, it’s too late.”