eBay's Meg Whitman on Building a Company's Culture

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And we didn't do it a lot, but we were very thoughtful about some categories.

One we certainly got questioned on was tobacco, firearms, and alcohol.

Correct. So as it turns out, alcohol, firearms, or tobacco is perfectly legal for sale in the United States and on the Internet. And this was another case where we said, especially in the early days of the Internet, I mean, you have to remember this was nearly 10 years ago, we just didn't know who those firearms were actually going to be sold to. We didn't know whether it would be underage kids who would be buying the alcohol. And frankly, there was a myriad of regulations where it was perfectly legal to sell wine from California to Wisconsin, but not California to Texas. And so, we said, you know, there are so many issues here. This is just one—again, one of those categories that we feel like we don't need to be in this business.

That's very interesting, because this is not necessarily financially a good decision.

No.

Judgment calls. We actually realized that we needed people to just make policy as to what was appropriate, what could be sold, what was legal, and the department was called Trust & Safety, and it was run by Rob Chestnut, the former federal prosecutor.

Now, there was one call that you and I disagreed on. And the issue was: Should we enable Paypal for legal adult and gaming sites?

I said no.

Right, that this was out of character for the company to do. And my comeback was that PayPal is a currency, and we cannot use it in some places and not in others. And so, we had this spirited debate, and you let me do what I wanted to do, which was enable PayPal.

Yes.

Why?

Well, that's a very good question. Why did I do that? No, I'm teasing. Companies are led by collections of individuals. I mean, yes, I was president and CEO of eBay, but you are only as good as the people you surround yourself with. Whether it's a nonprofit institution or a university, you're only as good as the people you surround yourself with. And I think if you want to get the very best people, you need to give them degrees of freedom, you need to give them latitude within a set of defined points of view, rules, if you will. And you need to let them figure it out. And PayPal was a separate division in eBay, which of course is a separate division from Skype. And this was a gray area.

It was a gray area.

And I was persuaded by your logic. And you were head of PayPal, and this was the kind of decision that I thought the division president should actually make.

Tell me a little bit, Meg, as a CEO, about what the risks are when you actually declare a character, a set of ethics for the company? And what I'm thinking about is the slippery slope so it doesn't get away from you and you can't control it.

Yes. Well, I think it also gets incredibly complicated as the company grows. I mean, when I stepped down as the president and CEO of eBay, we had 15,000 individuals operating in 30 countries across four major divisions. And by the way, cultural norms in different countries are very different. What the Korean team felt was appropriate was quite different from what the Chinese team felt; it was quite different from what the American team or the Argentinean team felt. And so, people said to me, well, how do I know what is the right thing to do? And this is something that worked worldwide, and it worked at all levels of the organization from president to administrative assistant. And what we said was, if you are in a room making a decision about an ethical or a moral issue for eBay, the eBay family, and your mother was in the room or your son or daughter was in the room or your husband or wife was in the room and they were watching you make that decision, would you be proud to have them watch? Would you be proud if they knew exactly what you had done? And if the answer to that is yes—

And it translated.

It translated across every culture. And then, the other test we used was, would you be proud to have that discussion almost word for word on the front page of The L.A. Times or the front page of The New York Times or the front page of The Wall Street Journal? And if you can't answer that in the affirmative, then it's probably not the right thing to do.