Thomas Cook. Don’t book it
In his excellent book, The corporation, Joel Bakan writes,
As a psychopathic creature, the corporation can neither recognize nor act upon moral reasons to refrain from harming others.
This is a case study. Unlike my blog on Talk talk, I have had to rely on media reports as I have no first hand knowledge of this case. I am assuming that the reports are materially correct.
In 2006, two small children, Christianne and Robert Shepherd, aged 7 and 6, died from carbon monoxide poisoning while they were on holiday in Corfu with their father and his partner (now wife).
They had inhaled CO fumes from a faulty boiler while they slept. The holiday had been booked through Thomas Cook.
Thomas Cook was cleared of any responsibility at a criminal trial in Greece in 2010 and [in May 2015] the inquest accepted that it had been misled by the hotel, although it deemed Thomas Cook’s health and safety audit to be inadequate. [*1]
There are a number of aspects to this case that illustrate corporate psychopathy.
Thomas Cook failed to apologise to the parents
Peter Fankhauser, who has been chief executive at Thomas Cook since November 2014, told the inquest jury: “I feel so thoroughly, from the deepest of my heart, sorry but there’s no need to apologise because there was no wrongdoing by Thomas Cook”. [*1]
Well, it depends what you mean by wrongdoing. If the inquest “deemed Thomas Cook’s health and safety audit to be inadequate”, then it did wrong by implementing inadequate procedures and/or having inspectors inadequately follow procedures. At best there was incompetence in the way the “audit” was carried out (had it been competent, the faulty boiler which eventually killed the children would have been detected).
There must have been a failing of management, too, because either it did not know that the health and safety regime was inadequate, or it did know but did nothing about it. That’s wrongdoing for which the company might have considered apologising, had it been less attached to being right.
Deconstructing this statement carefully, it is clear Thomas Cook believes it has no reason to apologise to the family because the family aren’t shareholders.
Francis Ingham, the director general at the Public Relations Consultants Association said: “When companies go into defence mode, they stop being human. The fundamental fact is that they [Thomas Cook] were not human”. [*1]
Exactly. The company is operating in its default psychopathic mode.
Mr Ingham added that he believed the company “have got it wrong the whole way through”.
His views are shared by Phil Hall, the former News of the World editor who founded PHA Media, which specialises in areas of public relations such as crisis and campaign management.
Mr Hall said: “I think the problem is that they were looking at the legal point and not the man on the street’s point…” [*1]
No, that’s not correct. Thomas Cook was looking solely to its own interest. The fact that that interest might be realised legally is by the by.
Thomas Cook did not pay the parents any compensation (for nine years)
Labelling claims that the hotel has agreed to pay “substantial damages” to the family “something of a joke”, Mr Shepherd wrote that the family were “pushed into accepting a derisory offer due to the Greek economy and the threat of possibly receiving nothing.”
“Every penny of compensation I have received has been invested for my children,” he said, adding: “It states that you are claiming damages for the trial costs along with compensation and refunds of affected holiday makers!”
Mr Shepherd then pointed out that he got “absolutely nothing” from Thomas Cook and had to settle for a partial refund through his travel insurance. [*2]
The then chief executive gets bonus of £10 million
On 28 May 2015, The independent reported that Ms Harriet Green, the chief executive at the time of the tragedy, was to receive Thomas Cook shares worth approximately £10,100,000, as part of a long-term bonus. She said she had agreed to give about £3 million to a charity of the parents’ choice from that bonus.
The tour operator has faced weeks of criticism after it refused to apologise to the family immediately after an inquest returned a verdict of unlawful killing.
It was later discovered that Thomas Cook had received compensation of £1.5m for lost bookings following the tragedy, while the family of Bobbi and Christi Shepherd received just £300,000.
She [Ms Green] said: “I am a great believer in corporate social responsibility, and this feels right to me.
“I have now reached out to the parents of Bobby and Christi Shepherd…” [*3]
Interesting use of the word “now”. Green, who is pictured in the media with a diamond encrusted cross around her neck, may believe in CSR, but she appears not to understand the concept of Christian charity. Would it not have been better if she had “reached out” to the parents nine years—nine years!—earlier at the time of the tragedy?
Speaking at a press conference in London, Sharon Wood, the mother of Christi and Bobby, accused Ms Green of using her children’s death to stoke public sympathy.
“If Harriet Green feels the need to offload some of that money to salve her conscience, that is her decision to make, but to try and gain public empathy by attaching her donation to the memory of my Christi and Bobby I find abhorrent,” she said.
To suggest that her family have anything to do with it is “simply wrong and I wish to make that clear now”, she went on.
A spokesman for Ms Green said: “She is deeply saddened that Ms Wood feels like this”. [*2]
Who cares if she is deeply saddened? This is not about her. Even when she has the chance to say something healing she makes it all about how sad she is.
Current chief executive
Meanwhile, back to Peter Fankhauser, the current chief executive.
At the weekend it emerged that Thomas Cook received compensation from the Louis Group, the owner of hotel in Corfu whose manager was convicted of manslaughter and jailed by the 2010 trial in Greece, along with two other members of staff.
In 2013 and 2014 Thomas Cook received £1.5m in connection with a settlement with Louis Group in relation to a case brought by Thomas Cook in October 2012.
Yesterday afternoon the travel company announced it had donated the £1.5m received to the children’s organisation Unicef, and stressed that the company had not profited “in any way from our claim against the hotel owner”.
In the statement, Mr Fankhauser also used the words “I apologise”, saying: “I believe this is the right thing to do and I apologise to the family for all they have gone through.” [*1]
That’s not enough. It may be necessary, but it’s not sufficient. The company still has to apologies for its failure to inspect the hotel properly, for its failure to know/care that it hadn’t inspected the hotel properly and, specifically, for the appalling (if completely explicable) way it treated the parents.
If Fankhauser knew then that it was the right thing to do to apologise, why didn’t he know this at the inquest, when his view was, “there’s no need to apologise”?
It is telling that he chose to apologise at the shareholders’ meeting. Clearly this apology was intended to mollify the shareholders (not the family) who are, of course, the only people to whom most corporations believe they are beholden.
Janet Street-Porter writes about this:
Can I proffer some advice? If you have to make an important apology, never read a script off autocue. Incredibly, that’s how Peter Fankhauser, the ham-fisted chief executive of Thomas Cook, chose to address the parents of Bobby and Christi Shepherd…
If he had any conscience Mr Fankhauser should resign. Nine long years after a faulty boiler in a hotel in Corfu devastated this family on holiday, he decided that a shareholders’ meeting was an appropriate occasion to offer his condolences before meeting the family. [*4]
They really don’t care. I don’t think they even know that they are supposed to care. The cross-identification of the individuals (Fankhauser, Green, and those Thomas Cook managers who exercised their right to remain silent at the inquest, thereby colluding in protecting the guilty (under what threats one wonders)) with the corporation is complete.
Looking on the bright side
The group’s shares were down 3 per cent yesterday at 156.1p and it is yet to be seen how much more of a lambasting it will get this week.
One financial analyst said yesterday that in the short-term there could be a financial impact but believes it will “be short term”, with no major impact on revenues. [*1]
Oh well, that’s all right then.
[*1] Thomas Cook: From a tragedy to a corporate disaster (Joanna Bourke, The independent, 19 may 2015)
[*2] Thomas Cook Corfu deaths: Holiday firm didn’t respond to furious letters from father of dead children for four months (Kashmira Gander, The independent, 29 may 2015)
[*3] Former Thomas Cook boss Harriet Green hands £3m to charity (Simon Neville, The independent, 28 may 2015
[*4] A horror show from Thomas Cook that tells you all you need to know about ethical consumerism (Janet Street-Porter, comment piece, The independent, 28 may 2015)
> Talk talk. Don’t bother [blog]
> The “psychopathic corporation”
© 2015 Jeremy Marchant . This blog is likely to be revised . image: Free images