Socially responsible business brawl.

Minneapolis

Peddling politics as much as beauty, Body Shop founder Anita Roddick took the cosmetics industry by storm and forged a popular icon of socially responsible business. "We believe that on issues you support--or are against--is a civic responsibility," says a spring 1994 Body Shop catalog insert. Yet when the press reported flaws in the Body Shop's progressive image, the company took on its critics as only a $700 million corporation can.

Marjorie Kelly, editor and publisher of Business Ethics--a bimonthly magazine with a circulation of 14,000--incurred the Body Shop's wrath last fall when she published an article entitled, "Shattered Image: Is the Body Shop Too Good to Be True?"

The article, by Emmy-award-winning journalist Jon Entine, alleged that some of the Body Shop's "natural" products contained cheap, petrochemicalladen ingredients; that lax quality-control resulted in the sale of some contaminated products; that charitable giving fell short of even the national corporate average; and that journalists who had tried to challenge the company's marketing hype had been silenced with libel threats.

As if to demonstrate this last point, Body Shop lawyers sent Kelly two letters containing strongly worded legal threats" before she went to press with "Shattered Image," she says. But Kelly refused to back down. The Body Shop story had to be told, chiefly for the lessons it provided those who seek to promote ethical business practices," Kelly says. She checked and rechecked Entine's sources and scheduled the piece for her September/October 1994 issue.

"I went to press in the face of threats from an enormous company because I knew that what we printed was true," she says. "Even if I was 100 percent correct, however, I could be put out of business. The cost of getting to the summary-judgment phase--where the judge says there is no basis for this charge--would run $100,000," an amount that would take the business right out of Business Ethics.

The Body Shop's litigiousness helped persuade Vanity Fair to nix a version of Entine's investigation. With help from public-relations giant Hill and Knowlton--particularly from vice-chairman Frank Mankiewicz, a former president of National Public Radio--the Body Shop launched a full-scale counterattack on Entine's credibility.

The Body Shop denied the charges, dismissed the credibility of Entine's sources, and characterized Kelly's decision to publish the piece as an irresponsible attempt to garner attention for her small magazine.

Shortly after publication, National Public Radio interviewed Entine on the air. After the program, Mankiewicz helped persuade NPR to run a follow-up story that included comment from Body Shop supporters.

"Like any other company, we should go to any length to protect ourselves when we feel like we're being dealt with unjustly," says Body Shop spokesman Bryan Weaver.

Kelly stands by the story she published: "For all its bluster, the Body Shop has failed to document a single error of fact in our article," she says.

Other organizations have since published independent research that corroborates many of Entine's conclusions. Franklin Research and Development, a Boston-based ethical investment firm, awarded the Body Shop its highest social ratings in 1991. But in 1994, Franklin's newslette supported many of Entine's charges against the company and rebuked the Body Shop for its combative stance toward critics: "The Body Shop's bombastic tactics have set back any legitimate attempts by the company to change."

In late September, Kelly discovered to her amazement that the Body Shop had acquired her subscriber list without her authorization. The Body Shop used the list to send out a ten-page refutation to the magazine's readers. Signed by chairman Gordon Roddick, the letter stated that Entine's article was "filled with lies, distortions, and gross inaccuracies," with "almost no attempt to observe the normal standards of journalism." The Business Ethics list manager, Stevens-Knox and Associates, learned of the mailing through employees whose names were planted on the list as decoys--a customary practice to guard against misuse of subscriber addresses.

Ralph Stevens, president of Stevens-Knox, is incensed that his services were used against his client. "The Body Shop duped a prominent and legitimate list-brokerage company, a respected magazine, and they duped us," he says. "If this is any indication of the way they do business, of their regard for honesty and integrity, I give them a failing mark on all counts."

Some members of the progressive business community have been reluctant, however, to see one of their leaders criticized. In a conciliatory forum hosted in the January/February issue of the Utne Reader, Eric Utne praised Roddick for "setting the standard for other businesses to follow."

"Socially responsible business has not wanted to take the Body Shop on," says Kelly. "This article was such a bombshell because it doesn't fit the model in our heads--that socially responsible businesses are the good guys.... We have to throw out the good guy/bad guy paradigm. The Body Shop is doing things that need to be corrected."