E-Mail Overload Or Avoidance?E-Mail Overload Or Avoidance?

One of the twists in the lawsuit brought against Morgan Stanley is that two top executives at the firm had their E-mail cordoned off from the company's rank and file.

Morgan Stanley officials explain the move as an attempt to screen the busy executives from a crush of time-consuming junk and other mail. But the plaintiff, Arthur Riel, alleges there was an ulterior motive: avoiding whistle-blowers.

New evidence in Riel's wrongful dismissal suit against Morgan Stanley includes an E-mail exchange among members of the firm's IT department as they set about reconfiguring the company's E-mail system so that then-CFO Stephen Crawford and then-CEO Phil Purcell would receive messages only from direct reports and Morgan Stanley board members.

Sarbanes-Oxley requires executives to investigate reports of internal misconduct, and Morgan Stanley's own code of conduct requires employees to report improper or illegal acts to their managers or, "if appropriate or necessary, to senior management." Morgan Stanley effectively eliminated E-mail as a channel that whistle-blowers could use to contact Crawford, who later became co-president of Morgan Stanley and has since left the firm, or Purcell, who left last June.

Such setups may be legal, but one business ethics expert says they represent bad policy. "By walling off senior management from contact with your employees, you undermine transparency, you undermine a broader sense of commitment, and you undermine the kind of candid, two-way communication that builds trust," says Noah Pickus, associate director of the Kenan Institute for Ethics at Duke University.

Some IT executives frown on any E-mail configuration that would isolate top-tier managers from their underlings. "Having that channel open helps senior management," says Robert Bongiorno, CIO of Automatic Data Processing, where any of the company's 40,000 employees can send a message directly to CEO Arthur Weinbach. "It allows them to hear things they might not ordinarily hear."

Morgan Stanley says its IT staff was merely trying to limit the volume of messages the executives received and, in doing so, help them "meet regulatory requirements by ensuring that [important] information isn't missed." The firm notes that employees can still pick up the phone.

Return to main story, Money, Power, And Principle