National / International News

Medicare Eases Restrictions On Pricey Hepatitis C Treatment

NPR News - Fri, 2014-05-16 08:02

This policy change would pay for treatment with a combination of new, expensive drugs for patients who haven't responded to older treatment regimens and are approaching or have cirrhosis of the liver.

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Is the French national anthem 'racist'?

BBC - Fri, 2014-05-16 08:01
Is the French national anthem 'racist'?

Does It Matter if Schools Are Racially Integrated?

NPR News - Fri, 2014-05-16 08:01

Sixty years ago, the historic Brown v. Board of Education ruling was supposed to level the field for all students. But some educators say we haven't made a lot of progress.

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Games tickets sale resumes next week

BBC - Fri, 2014-05-16 08:00
Extra tickets for the 2014 Commonwealth Games in Glasgow are to go back on sale on Wednesday at 10:00 after problems saw sales suspended.

The cookie factory that balances profit with progress

Marketplace - American Public Media - Fri, 2014-05-16 07:55

Through the 1960’s, companies felt social responsibility was part of their culture. That all changed after a 1970 essay by Milton Friedman in the New York Times –“The Social Responsibility of Business is to Increase its Profits."  But recently a new type of corporate status has become popular, the Benefit Corporation, which requires companies to do social and environmental good.

Social responsibility has a warm, chocolatey, toasty fragrance. It's what the air inside Greyston Bakery in Yonkers, N.Y., is perfumed with, and it's enough to stop a reporter in her tracks.

"That would be remnants of brownies," says Mike Brady, the company's CEO. 

Greyston turns out 30,000 pounds of brownies a day for Ben and Jerry’s Chocolate Fudge Brownie Ice Cream. The bakery sold almost $10 million of brownies last year. But Greyston isn’t a typical company. It’s what's called a Benefit Corporation. That means in addition to normal  requirements, Greyston also has to create a “material positive impact on society and the environment.”

Brady can provide a substantial list of positive projects the company has undertaken: solar panels on its roof, buying sustainable cocoa and sugar, providing social support for workers who need extra help outside of work -- and when jobs open up, anyone gets the chance to work, no questions asked. The company even keeps a sign-up sheet in its reception area.

Companies can now become benefit corporations in 22 states, but how do you reconcile a social mission with a bottom line?

“I could spend 100 percent of my time trying to figure out the solutions for selling a good product." Brady says. "But I dedicate my time and the time of my team to trying to focus on how we can figure out the environment and the community, ultimately hoping that that’s going to lead to us selling more products, and that’s been the case so far.”

Erik Trojian, director of policy for B Lab, a non-profit that certifies benefit corporations, says that traditional corporations are limited by their duty to maximize shareholder profits, rendering them unable to focus on other missions.

"The unique thing of a benefit corporation is it deregulates the purpose of a corporation by saying, you can consider other factors than profit," he says. "You can consider society and the environment. In addition to profit."  

Trojian notes that because benefit corporations have to report and answer to shareholders, just like traditional corporations, unlike traditional corporations they can be held accountable for doing good.

"If the only goal of a corporation is to maximize profits, these investors don’t have a right to say, well, I have a mission-oriented fund, I invested in your company, you said you were going to consider society and the environment, but you stopped doing that. You have no recourse," he says, "but to sell your stock and get out or take what’s given."

Reporting to shareholders, he says, means a benefit corporation keeps operations transparent -- unlike a traditional corporation, which may focus on a specific, targeted social or environmental project like cleaning up a polluted waterway but isn't necessarily held responsible for its achievement in that area.

"That doesn’t mean the company isn’t polluting out the front door," says Trojian, "while it’s cleaning the back door. So that’s the dilemma with that,  it doesn’t really provide the consumer with a complete understanding of what the totality of the company’s operations are."

Lynn Stout, a professor of corporate and business law at Cornell Law School, says the misunderstanding lies elsewhere. The purpose of a corporation, she wants to make clear, is not to maximize shareholder profits.

"It turns out the purpose of the corporation is to do, and I’m taking this right from what the vast majority of corporate charters say," she says, "they say the purpose of the corporation is to do anything lawful.”

Stout notes that companies do often focus on shareholder value. One of the biggest reasons for this, she says is that tax law requires executive pay to be tied to a metric and very often that metric is share price. "So we shouldn’t be surprised that if we pay executives to bump up the share price, that’s what they do," she says. "But that’s not required by the law in the sense that you can’t sue managers for making decisions that reduce profits, or perhaps don’t move the share price up as far as it can go."

Stout says we don't need benefit corporations.

"I don’t think we do," she says, "if what you want to do is create legal space for managers to run companies in a socially responsible fashion."

But she notes, when it comes to focusing on social and environmental goals, there are some benefits, to having benefit corporations, such as the inherent appeal, to some consumers, that comes along with the label of benefit corporation. 

"It’s very much a marketing thing," she says.  "For example, Patagonia is a benefit corporation and they make a line of clothing suited to outdoor activities. A lot of people who like outdoor activities are very concerned about the environment. And they might be willing to buy Pataonia instead of another brand, because it’s a benefit corporation."

Then Stout  says there's the requirement to report to shareholders about social and environmental impact.

"The benefit corporation is supposed to provide information that’s available to shareholders and others, to show that they’re actually making progress towards that objective," she says. "And that requirement, that you provide information, may be very, very important."

"There’s a saying in business," Stout says, "that what you measure, is what you manage. And if all you’re measuring is profits, that is naturally  going to be your focus."

Guilty school crash driver fined

BBC - Fri, 2014-05-16 07:53
A driver found guilty of carelessly driving a car which ploughed into a lollipop lady and five pupils outside a school is fined £100.

PODCAST: Some (temporary) relief at the pump

Marketplace - American Public Media - Fri, 2014-05-16 07:53

After a steady rise since February, gas prices are leveling off, and even dropping in parts of the country. But the relief is only temporary.

Europe's biggest construction project is currently underway in London: a new 73-mile long rail link passing underneath the British capital.

It's the time of year when TV networks try to get audiences -- and advertisers -- excited about their upcoming season. One genre that's now a tough sell to both is music.

General Motors fined $35m over recall

BBC - Fri, 2014-05-16 07:47
The US government fines General Motors $35m(£20.8m) for delays in recalling small cars with faulty ignition switches.

Fatal microlight crash pilot named

BBC - Fri, 2014-05-16 07:46
A man who died after his microlight aircraft crashed at a north Wales airport is named as Ashley Hazelwood.

Angola's first post-colonial census

BBC - Fri, 2014-05-16 07:34
Oil-rich Angola is holding its first national census since 1970 - when the country was still a Portuguese colony.

California wildfires rage overnight

BBC - Fri, 2014-05-16 07:24
Firefighters continued overnight to battle wildfires in California, which have burned more than 11,000 acres and caused thousands of evacuations.

Why people get tattoos of their employer's logo

BBC - Fri, 2014-05-16 07:21
New York Times executive Jill Abramson had the newspaper's 'T' tattooed on her back. Why do employees do this?

Man killed sex abuse stepfather

BBC - Fri, 2014-05-16 07:20
A man who killed his abusive former stepfather by running him over in his car is jailed for manslaughter.

Sterling 'will not pay' NBA fine

BBC - Fri, 2014-05-16 07:16
Los Angeles Clippers owner Donald Sterling has said he will refuse to pay a $2.5m (£1.5m) fine from the league for racist comments, US media report.

Colombia rebels declare poll truce

BBC - Fri, 2014-05-16 07:10
Two rebel groups in Colombia, the Farc and the ELN, announce a unilateral truce with the government during the country's forthcoming elections.

Friday's gossip column

BBC - Fri, 2014-05-16 07:06
Berahino to Newcastle, Sagna set to join Manchester City and Kouyate interests Arsenal, plus more.

GM Will Pay $35 Million Fine Over Massive Safety Recall

NPR News - Fri, 2014-05-16 07:01

The much-criticized recall of more than 2 million vehicles for ignition-switch and air-bag problems has resulted in a record fine for the automaker, the Department of Transportation says.

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Turkish mine owner denies negligence

BBC - Fri, 2014-05-16 06:53
Turkish mine operator Soma Holding denies negligence in Tuesday's deadly mine collapse that killed at least 284 people.

Week in pictures: 10-16 May 2014

BBC - Fri, 2014-05-16 06:45
Some of the best news photos from around the world

Snobby salespeople sell more luxury goods

Marketplace - American Public Media - Fri, 2014-05-16 06:42

When Groucho Marx once said, "I don't want to belong to any club that will accept me as a member," he might've been talking about a recent study: “Should the Devil Sell Prada? Retail Rejection Increases Aspiring Consumers' Desire for the Brand. Customers are more likely to buy luxury goods from rude, snooty, or aloof salespeople.  

When it comes to high-end goods, we want what we can't have, and a salesperson with a bad attitude only adds to the air of exclusivity.  

Darren Dahl, professor of Marketing and Behavioural Science at the University of British Columbia's Sauder School of Business, co-authored the study and says that the outcomes were based on a number of factors.

“…[I]t only really works if you aspire to the brand. So, if it’s something that you want and you don’t have. For the consumers that are regular luxury shoppers, this effect doesn’t happen,” Dahl says.

Another factor in whether or not a customer is swayed by rude customer service is the salesperson’s appearance.

“[The effect] also doesn’t happen if the salesperson doesn’t match the brand. If someone is selling Prada or Burberry and they don’t look like they should be there themselves, you don’t get that effect. You only react if someone truly represents the brand,” Dahl says.

Scarcity and exclusivity are two major components of persuasion psychology, but Dahl says that there is more behind the findings.

“When you come into a store and salespeople give you a dirty look, or they ignore you, or they essentially make you feel like maybe you’re not in the right store, if you as a consumer really want that brand, it’s kind of  challenge. [That’s] the way people looked at it and said, ‘Hey, I can afford that and I’m going to show you’,” he says.   

In the end, Dahl says that good customer service is always the best way to go. 

For one, non-luxury stores see no benefit from having rude salespeople, as the study showed that customers were not more likely to buy goods from a store that isn’t considered aspirational or prestigious. 

Also according to the study, people who initially felt driven to purchase from the snobby salesperson had, what Dahl calls, a boomerang effect.

“In the moment, you react and take the challenge and say I’m going to buy that product. But after you get home [and} you’ve been thinking about the experience … it actually turns out that you dislike the brand and the experience much more than the average person,” he says. 

 Have you ever been treated poorly by a sales associate?  How did you react? Email us or Tweet at us @LiveMoney

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