Copyright 2008. No quotation or citation without attribution.
IR/PS CSR Case #08-01

GoodGuide: Is this Company
Really Providing Customers withAccurate and Reliable Product
Information?
By: Kim Ascoli

GRADUATE SCHOOL OF INTERNATIONAL RELATIONS AND PACIFIC STUDIESUNIVERSITY OF CALIFORNIA, SAN DIEGO

Prepared for Professor Peter Gourevitch
Edited by Kristen Parks
Corporate Social Responsibility
Fall 2008

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Table of Contents
Introduction: ..................................................................................................................... 3
GoodGuide: ....................................................................................................................... 3
Overview of Company:.................................................................................................... 3
Target Audience: ............................................................................................................. 5
Governance and Funding: .............................................................................................. 6
Alternatives to GoodGuide: ............................................................................................ 7
Reliability of Rating Methodology .................................................................................. 8
Data Sources:.................................................................................................................. 8
Data Collection Process: .............................................................................................. 10
Rating System and Weighting: ...................................................................................... 11
Missing Information:..................................................................................................... 13
Consumer as Reviewer:................................................................................................. 14
Analysis of Credibility and Transparency.................................................................... 15
Governance Issues: ....................................................................................................... 15
Funding Issues: ............................................................................................................. 16
Rating Methodology and Weighting Issues:.................................................................. 17
Incentives to Mislead: ................................................................................................... 18
Costs of Being Wrong: .................................................................................................. 20
Conclusion: ...................................................................................................................... 22
Discussion Questions: ..................................................................................................... 23
Appendix 1: GoodGuide Sub-Categories ..................................................................... 24
Appendix 2: Sample Product Rating ............................................................................ 25
Appendix 3: Good Guide Staff and Advisors ............................................................... 26

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Introduction:
GoodGuide was founded on the principle that consumers want information about
the products in their homes, specifically related to: 1.) the ingredients in the products andthe potential health effects of these, and 2.) the manufacturer’s environmental and social
track record. Launched in 2008, Good Guide allows customers to review over 60,000
household products, each with an individual rating based on health, environmental andsocial impacts. The company’s founder, Dara O’Rourke, explains that “there's aburgeoning awareness that there is a global supply chain behind a product. People areseeing that there are real costs to these everyday low prices.”1 GoodGuide seeks toprovide customers with information related to these ‘real costs.’ This paper seeks toanswer the following questions: Is GoodGuide’s rating method reliable for consumers ofhousehold goods? What makes the company credible?
The report is divided into three main sections. The first section will provide an
overview of the company and describe how products are rated, including data sources,
data collection process and rating methodology. The second part will attempt to answer
the key questions; lastly, the third section will conclude the paper and pose further
questions for discussion.

GoodGuide:
Overview of Company:
GoodGuide was founded by UC Berkeley professor Dara O’Rourke in order to filla gap he perceived between the product information manufacturers provide and the1

Madrigal, Alexis. “Startup Fights Greenwashing With Data Sent to Your Phone.” Wired.com, 10
September 2008. http://blog.wired.com/wiredscience/2008/09/website-launche.html#moreCopyright 2008. No quotation or citation without attribution.

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information customers want. His intent was to create a space where customers could
obtain simple and reliable third party reviews on the health, environmental and social
effects of products they own or intend to purchase. On its website, the company explains
its purpose:
What chemicals are in your baby shampoo? Was sweatshop labor used to makeyour t-shirt? What products are the best, and what products should you avoid?
Increasingly, you want to know about the impacts of the products you buy. On
your health. On the environment. On society. But unless you’ve got a Ph.D, it isalmost impossible to find out the impacts of the products you buy. Until now...
The company uses data acquired from various sources to give scores in three areas:
health, environment and social impacts. The data is obtained primarily fromgovernments, private research firms, non-profits, academics and media reports.
GoodGuide staff “evaluates each data source, rates it, and then layers it into algorithms.”2
With regards to their evaluations, GoodGuide seeks outside academic advice and reviewsof the data and the weightings. The data is given a rating (from 0 – 10 in each category).
These ratings are then averaged (equal weight is given to each category) for the final
product score.
The company currently employs eleven full time employees, most of whom areeither scientists or engineers. GoodGuide also relies on an extensive network ofacademics and professionals (see Appendix 3 for complete list) for regular advice andfeedback. The company’s primary vehicle of communication is its website,www.goodguide.com, to which customers register for free in order to access information
and reviews of the products. The website lists all the reviewed products, and subscribers

2

From e-mail communication with Dara O’Rourke. 2 December 2008.

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are encouraged to click on a select product to obtain detailed information on it. The
website also lists other information that may be useful to readers as they make purchasing
decisions; such as a company’s political contributions. There is also an opportunity forviewers to personalize their lists, such as by creating a shopping list and e-mailing it orsending it to a mobile phone.
What makes GoodGuide unique is two-fold: 1.) the “full-package” approach it
takes to assess product information, and 2.) its mission to deliver the information to
consumers in a user-friendly and easy-to-understand way. As one recent review states:“GoodGuide simply delivers you product information as and when you need it.”3 The
information is not reserved only for academics, or for people interested in lengthy anddetailed product information.
Target Audience:
The website seeks to attract young, conscious consumers who are familiar withcomputers and electronic applications (such as iphones). Specifically, GoodGuide is
attractive to busy consumers who are interested in the environmental, health and social
impacts of their purchases but do not have time to conduct extensive research themselves.
During an interview, O’Rourke explained that these people are looking for a quick
assessment, and are not overly interested in the metrics or data used to derive eachrating.4 GoodGuide is banking on the fact that it can quickly earn the trust of these
consumers; and that they will want quick information about the products they intend topurchase.

3“iPhone App Sends Greenwash Alerts Directly To Consumers” Triplepundit. 17 September 2008.
http://www.triplepundit.com/pages/use-your-iphone.php
4Phone interview with Dara O’Rourke, 20 November 2008.

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Governance and Funding:
Initially GoodGuide was housed within UC Berkeley. Once it became an
independent entity it was incorporated as a for-profit company in the state of New Yorkas a privately-owned Certified B Corporation5, with a special charter recognizing thecompany’s social and environmental focus. This is a voluntary assignation, andaccording to the B Corporation website, being incorporated as this unique type of forprofit organization allows the company to maintain its independence, while creating
benefits for all stakeholders (and not only shareholders) and meeting strict environmental
and social criteria. During an interview with the founder of GoodGuide he explained that
GoodGuide “is an independent organization, and credibility is (the) number one
priority.”6 According to O’Rourke, the employees, the advisors, the board of directors
and UC Berkeley are all “owners” of the company.
As of now, GoodGuide is not financially independent. Its early funding camefrom various sources, including the University of California, the Wallace Global Fund,the Overbrook Foundation, the New Place Fund and the National Collegiate Inventors
Association. No yearly budget figure is given on the website. The company has nocommercial aspects to it; for example, there are not advertisements on the website and themembership is free. When asked about the financial sustainability of the company Mr.
O’Rourke pointed out that now the focus is first and foremost on becoming credible anduser-friendly; however, in the long-term sustainability is indeed key but there are noconcrete plans as of today.

5
6

B Corporation website: http://www.bcorporation.net/
Phone interview with Dara O’Rourke, 20 November 2008.

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Alternatives to GoodGuide:
Alternatives for obtaining complete information on a household product’s health,social and environmental impact are almost impossible to come by. Similar to
GoodGuide, a few other sites have recently been established that seek to make shopping
an educational experience. One such example is Alonovo. This company’s mission is to“connect the concept of corporate behavior directly to the profit motive”7 which it doesby providing readers and shoppers with company ratings in areas such as Social
Responsibility, Healthy Environment, Fair Workplace, Business Ethics and Customer
Focus. The hope is that ratings in each of the categories will influence buyer’s decisions.
However, the site does not focus on specific products, instead, it reviews companies.
Actual purchases made on the site are linked directly with a green cause (whichcustomers individually choose).
Most information available about a product’s ingredients and health effects ispresented by the manufacturer itself (on the company’s website for example). Also worth
nothing is that the U.S. Government does not have complete and publicly available
information on a product’s health, environmental and social impact. However, the U.S.
Department of Health and Human Services (HHS) website does have an extensive
database of household products, yet the information is lacking. Specifically, the HHS
data provides information about the product’s manufacturer, health effects, handling anddisposal and ingredients but the HHS does not independently test or assess any of the
products: the website states that the product information “is taken from the product label
and/or the Material Safety Data Sheet (MSDS) prepared by the manufacturer. The (HHS)

7

From Alonovo’s website: http://www.alonovo.com/community/about

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does not test products nor does it evaluate information from the product label or the
MSDS.”8 This quick review of GoodGuide’s competition shows that there are few
alternatives that offer similar or the same services.

Reliability of Rating Methodology
In the next section the paper explores the reliability of GoodGuide’s rating systemfor consumers of household products. The success of the company hinges on how
reliable the ratings are perceived by consumers. The section begins by examining thesources of data, followed by a review of the information collection process and
GoodGuide’s rating system. Lastly, it addresses the issue of missing information and therole of consumers as reviewers. The section asks questions that consumers wantanswered in order to trust and be reliant on GoodGuide’s product ratings.
Data Sources:
GoodGuide obtains data on products and companies from a varied pool ofsources. Most information comes from a third party source; however, some information(such as ingredients) is obtained from the manufacturer directly. A small percentage ofthe data is purchased but the majority is provided to the company for free. As mentioned
previously, the primary sources of data are governments, private research firms, nonprofit organizations, academic institutions and media reports. With regards togovernments, the company obtains information primarily from the U.S., European and
the Australian governments. With regards to research firms, the company has partneredwith KLD Research, Risk Metrics, Asset4 and Innovest who provide data primarily on

8

From HHS website: http://householdproducts.nlm.nih.gov/cgibin/household/brands?tbl=brands&id=18001201

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corporate governance issues. The company has also partnered with the Environmental
Working Group, and other non-profits, which have conducted extensive research on thehealth and environmental impacts of products.
The first step in examining the reliability and validity of GoodGuide’s
information is to examine and question the sources of GoodGuide’s data. We know thesources of this information, and as consumers of this information, we should question thevalidity of each of these sources, and ask ourselves why we would be inclined to believe
information provided by them. Are all of them really third-party sources? On its website
GoodGuide does not provide information on which specific governments and agencies it
collaborates with (the general information on governments who provide information wasprovided by O’Rourke during an interview). As a customer I would be less confident incertain governments than others (e.g. less confident in Chinese government that a
European government). Since we do not have much information on government sources
consumers are left to “trust” GoodGuide and its staff’s judgment with regards togovernment information.
With regards to private research organizations, GoodGuide does provide us withnames of all its partners. Customers are then left to judge each of these sources
independently if they so choose. For example, KLD Research is a well-establishedresearch firm that provides information on social and environmental factors of companies
to potential investors. We may ask ourselves if KLD and the others have any motive forcheating and providing false information, and if their websites and information is“transparent” enough for us as consumers of their data. The same questions apply to thenon-profits that GoodGuide partners with. As consumers, we need to question theirCopyright 2008. No quotation or citation without attribution.

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validity and their transparency. Are their missions and objectives aligned with those of
GoodGuide? Do we trust them for information? Do we know who is on the boards of
directors? Do they have any ties to GoodGuide or product manufacturers? Likewise, weknow very little about the data received from media reports, and the same questions arise
from these sources. Without names, how can consumers of GoodGuide’s ratings know ifthey can trust their information? In general, GoodGuide provides insufficient
information on its data sources. This is a key component for GoodGuide’s reliability, if
users do not understand or know about the data sources and the steps involved inanalyzing it, how can the ratings be reliable?
Data Collection Process:The actual collection process is quite confusing. It appears that the data is
obtained from the various sources in a raw state (absolute, relative or binary data); that is,
it has not been condensed into categories yet. The various sources are rated by
GoodGuide staff and then based on these ratings are given a certain weight and layered
into algorithms. This information then is fed into the GoodGuide database. What isunclear to outsiders related to the collection process is: 1.) at what point is the data ishanded over to the company, 2.) what condition this data is in (raw or already weighted),and 3.) when, how and by whom the weighting and rating happen. The third question is
explored in the next section (section C).
It is important to know the answers to these questions in order to assess thereliability of the ratings. How can customers find the rating reliable if they are not clear
on when the data is changes hands, and in what form the data is in? During a
conversation with Dr. O’Rourke, he explained in great detail how the data is sorted andCopyright 2008. No quotation or citation without attribution.

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assessed in order to obtain the final scorings available to the public. The whole process is
no doubt long and arduous, however, the consumer knows little about it. How do weknow that GoodGuide or its data sources are not “cutting corners”? It makes it muchharder to answer this question if customers are not clear on the steps involved in thetransfer of information and the rating. We know that somehow the data is categorized
into the sub-categories listed (see Appendix 1) but we have no information at what point
in time this happens, or by whom it is done. Knowing the steps involved in the datacollection process, and the actors responsible for each step is crucial public informationthat helps individuals determine the reliability of the final rating.

Rating System and Weighting:This portion of GoodGuide’s work is the most public and visible, therefore, it isalso the part that customers are most likely to question related to reliability. To someextent the credibility of the company hinges on the reliability and accuracy of the productrating. On the website GoodGuide states that it has approximately 600 base categories(which we assume is the information the company collects from the various data sources)
which it then separates into sub-categories (such as cancer effects, climate change
policies and human rights) which fit within the three main areas (see Appendix 1). At
this stage it is already not clear if the base categories have been evaluated during thecollection process; it is unclear if this data is in raw form or already rated in some way. If
it has been rated we also do not know by whom (GoodGuide staff or by third party data
providers). In any case, GoodGuide professionals rate the base category information

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using the GoodGuide rating system, which scores from zero to ten; zero being “terrible”
and ten being “excellent.” Below is the rating scale:
Terrible

Poor

Fair

Good

Excellent

0–2

2–4

4–6

6–8

8 – 10This rating scale allows the customer to compare scores across products. With
regards to the process used, GoodGuide rates each of the sub-categories, and thenaverages these out to obtain a final score for the category (health, social andenvironment). The three categories are then averaged for a final score. In each of thesteps, categories are weighted equally in order to obtain the final score (see Appendix 2
for sample product rating).
When examining the reliability of GoodGuide’s rating system several questions
come to mind. Consumers will wonder, again, who does the actual rating, and when andhow does this happen? Why are these raters reliable and trustworthy? Do these raters
have a certain profile or credentials, if so, what are they? Currently, it appears that
GoodGuide staff does the actual rating, by subjectively assessing the information. But dothey use benchmarks? Since this is a subjective and qualitative rating system, how can
we trust that what GoodGuide assigns as “good” is indeed good to all customers? How
often, if at all, are products re-rated? Customers will feel reassured of the reliability of
the rating if they have answers to these questions.
Also related to the rating, it is important to make note that using GoodGuide’s
current rating system the company is unable to make judgment calls on all issues related
to health, environment and social impacts. This is because there are too many issues andCopyright 2008. No quotation or citation without attribution.

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too many personal judgments to consider. For example, there may be certain ingredients
which are legal in the U.S. but are illegal elsewhere (e.g. in Europe). A product with thisingredient may get a good health rating, since it meets all other criteria. But there iscurrently no system for a customer to be alerted to the fact that this ingredient is
controversial. One reviewer of the site has already run into this problem. This person
searched for a specific ingredient, Triclosan, which has been linked to “possibly
contributing to the spread of antibiotic resistant bacteria”9 but found no mention of thisfact on any of the products listing this ingredient. The question for GoodGuide is how toincorporate alerts (or red flags) into the ratings.
Missing Information:
GoodGuide deals with missing information in several ways. According toO’Rourke, if information is missing in one of the many base categories professionals(such as statisticians) use techniques for smoothing the data. If more substantial
information is missing, such as for a sub-category, viewers are informed that no data isavailable and the other categories are averaged using equal weight. If no information isavailable in one of the three main categories, such as health, the other two categories areaveraged for the final score using equal weight (and there is no indication of missing
information on the final score). Data can be unavailable for several reasons. For
example, many of the companies reviewed by GoodGuide are not publicly traded firms,
and therefore they are not obligated to disclose information to the public. In other cases,
the data available may not be from a source deemed as credible by GoodGuide staff, so it
is simply not included.

9

Alter, Loyd. “GoodGuide Helps You Shop for the Safest, Healthiest Products.” Treehugger. 9 November
2008. http://www.treehugger.com/files/2008/09/good-guide-helps-you-shop.php

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Missing information poses a significant challenge for the reliability of
GoodGuide’s ratings. If consumers do not think that the company has enoughinformation to make a judgment call on the product, why would they rely on the rating?
However, GoodGuide cannot use information that it deems not credible or false. On theother hand, customers want to be informed that information is missing. This should
always be disclosed upfront, which GoodGuide sometimes does not do. For example,
when a product’s final score is obtained from averaging only two of the categories,
customers should be alerted to this upfront (such as by a red flag next to the final score).
Related to the process of smoothing data, customers should understand who does this andhow it is done. Knowing what goes into this process will make the rating much morereliable.
Consumer as Reviewer:
The last issue examined related to the reliability of GoodGuide’s rating is the useof the consumer as a reviewer of the product. Currently, GoodGuide allows forcustomers to voice their opinions about the products on its website. Each product page
has a space for User Reviews; customers are asked to rate a product’s performance bygiving it from zero to five stars (five being the best). The site also shows reviews fromamazon.com. To date there do not appear to be many customer reviews; however, in the
future the company may begin to weigh customer performance reviews into the finalscore.10
Would providing consumer performance and quality reviews of products increase
GoodGuide’s reliability? Is there any advantage to including customer reviews as part of

10

Phone interview with Dara O’Rourke, 20 November 2008.

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the product rating, or if it is best to leave the consumer review as a side item as it is now?
For the most part, consumers are reviewing the product’s quality and performance, which
as of now is not a factor in GoodGuide’s assessment. What can GoodGuide gain byincluding reviews? Also, the company should ask whether consumers are a good sourceof information on a product’s performance, and if so, are consumers the best source of
this information? How can the company manage and verify the reviews?

Analysis of Credibility and Transparency
Gaining consumer’s trust and being perceived as a credible and reliable company
are priorities for GoodGuide. In order to do this effectively, it is logical that GoodGuide
needs to be extremely transparent about everything it does, including its governance,
funding and the product rating process. This can pose a significant challenge for thecompany, given the magnitude of information involved in its work. This section of thepaper focuses on analyzing the company’s track record related to its credibility andtransparency.
Governance Issues:
The general observation is that GoodGuide is not very transparent with regards to
the governance of the company, therefore making it hard to analyze its credibility. This
lack of information about the governance could cause consumers to question thecompany’s reasons for withholding information and may have an effect on the customers’
final credibility assessment of the company. Most information in this area was provided
directly by O’Rourke and not on the website. For example, we know that the company iscertified as a B Corporation; however, this fact is not mentioned specifically on theCopyright 2008. No quotation or citation without attribution.

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website, it is only alluded to. Does this voluntary assignation make the company more orless credible? And why is the company not talking about this on its website? Does being
a for-profit organization make it more or less credible for consumers? On one hand, theorganization may one day be sustainable and make a profit; on the other hand, does thischange consumer opinions related to the motivation behind the company?
Another piece of information that is completely left out on the website is
management and board information. Nowhere on the site are there facts on thecompany’s structure or mode of operations. We know nothing about the staff size andexpertise from the website, the information we have (see Appendix 3) is from e-mailconversations with O’Rourke. Most importantly, we know nothing about the board of
directors. The board is not mentioned anywhere on the website; we do not know who
they are, what their role is and their level of involvement. This is a glaring omission; andone that could easily be perceived as intentionally hiding information. How can we
assess the company’s credibility with no information on those who are running andmanaging it? Also unclear are the roles of the “trusted advisors” and the “academics andscientists” that the website alludes to. As consumers we are left wondering what theirrole is, why we should trust them and if they are compensated for their work.
Funding Issues:
Another area where GoodGuide lacks transparency is related to its finances,which makes it hard to assess its credibility in this subject. Consumers can easily
question the lack of information and decide that withholding financial information isquestionable behavior. The website provides a list of early funders, but it is not clear if
these funders continue to support the company today. Also, the role of UC Berkeley as a

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long-standing funder and supporter is not made explicit. Certainly the association with awell-known university significantly increases the credibility of the company in the eyesof some, but the company provides no specific information. We know that early on
GoodGuide was housed within the university itself, but nowhere does the website explain
how much funding continues to come from the university and if it is represented on theboard of directors. Also, for how long has UC Berkeley funded GoodGuide and is there
an end date to the support?
Most importantly, visitors to the website have no idea what the yearly budget is,and the breakdown of expenditures. This represents another glaring omission on thewebsite. When deciding if the company is credible or not, consumers will want to know
how much money it spends on data sourcing, management, etc. Also, where is thismoney coming from today? Who are the funders? Are they private individuals, public
institutions, foundations or venture capitalist firms? And, since the company is set up as
a for-profit, shouldn’t there be more emphasis on becoming profitable and sustainable?
This represents a flag of concern, why is the founder himself not preoccupied withfinancial independence?
Rating Methodology and Weighting Issues:
It is imperative that GoodGuide be transparent and understandable related to its
rating methodology. Generally speaking the company should do a better job at clearly
articulating the various steps involved in the rating process; currently the information
provided on the website is confusing and insufficient. The lack of transparency in thisarea speaks to the overall credibility of the company’s work.

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The first observation is that despite weeks of research on this company I am still
unclear on the exact steps taken to get from raw data to a final rating. The roles of thevarious actors (such as data providers, GoodGuide staff and other “experts”) are notdefined, which makes it hard to hold one party accountable for each of the steps. How
can the company be perceived as credible by consumers if the process used to rate
products remains shrouded in mystery? Consumers understand the rating process iscomplicated; however, the challenge for GoodGuide is to communicate the method to the
public in a simplified yet transparent way.
Missing information poses another challenge for GoodGuide, and again,transparency is key. As discussed earlier the company does not currently alert
consumers in a product’s final review that information is missing in one of the three
categories. This lack of transparency directly impacts the credibility of the rating.
Another important point to make is the lack of information on the website
regarding the current weighting system used for the rating. The method should be
explained outright, so consumers understand the levels of importance given to each of thecategories. GoodGuide plans on allowing consumers to set their own weighting criteria,
which is a creative and interesting approach. However, in the meantime, the website
should provide information on the current system used, which places equal value on eachof the categories (and sub-categories). Transparency with regard to the weighting will
add credibility to the company’s methodology.
Incentives to Mislead:
Examining the incentives for GoodGuide to mislead is another good way of
studying its credibility. Does the company have strong incentives to provide false ratings

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or to cut corners in its analysis of data? If so, who is providing these incentives and can
GoodGuide overcome them?
The first incentive that comes to mind could be provided by the manufacturers.
If they felt threatened by GoodGuide’s ratings of their products they could fairly
effortlessly yield significant pressure on GoodGuide. These manufacturers are often
large and powerful multinational companies, and could therefore easily pressure a small
company to act on their behalf. The manufacturers could do this in several ways. For
example, one of them could potentially partially fund GoodGuide, or have a
representative on the company’s board of directors who could speak on its behalf. In
either of these instances the manufacturer could affect GoodGuide’s work. More drastic
would be if the manufacturers were to offer bribes or pay-offs to GoodGuide in order toobtain a better rating. Lastly, the manufacturers would also make threats to GoodGuide inorder to influence the ratings.
In an interview with O’Rourke, he noted that several manufacturers have alreadyapproached GoodGuide and questioned the rating methodology, which could imply thatthe companies are already feeling threatened. This could be a good sign, since
GoodGuide may be exposing the truth behind the products and the company’s trackrecord. On the other hand, this could also signal that GoodGuide is under pressure toprovide favorable reviews.
Another incentive to mislead is provided by the rating process itself. Given thecomplexity and time-consuming nature of GoodGuide’s rating methodology, coupledwith the lack of public understanding of the process, it seems like an easy option tosimply “cut-corners.” How could anyone ever find out if GoodGuide is doing this? Is

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anyone double-checking their work? Is there an economic incentive to shorten theprocess? We know GoodGuide is not financially independent, and we are not certain
about their current budget, so would it seem possible for the company to be mindful of its
spending and overlook certain steps in the rating process? Also, as already mentioned,
GoodGuide has no competition per se, which makes cutting corners much easier. No one
is comparing the quality and accuracy of GoodGuide’s ratings to that of anothercompany, which makes it difficult for consumers to create standards for what they expectfrom the company. This situation could potentially create an incentive to provide lessaccurate ratings.
One way GoodGuide can overcome several of these incentives to mislead is bybeing transparent with the public. Making the public more aware of the rating
methodology and the company’s governance would diminish the internal incentives tocheat. Also, increased transparency and media exposure could potentially drive
manufacturers to change their practices. In this instance GoodGuide would be operating
as a vigilante, exposing companies and pressuring them to change in order to remain
trustworthy and reliable in consumers’ views.
Costs of Being Wrong:
Yet another way of analyzing the credibility of GoodGuide is by examining theprice it pays if it is wrong. In other words, what does GoodGuide loose by cheating?
Lupia and McCubbins researched this concept, and found that as the cost of lying
increases subjects are less inclined to lie. In the case of GoodGuide, we can examine
how much it loses by providing false information, such as giving false information on its

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website or rating a product inaccurately. Also, we should examine how easy it is to findout if GoodGuide is lying, and who would be inclined to investigate this issue.
At first glance it appears that the company has much to lose by providing an
inaccurate product rating, since this is the foundation of its work. As Dr. O’Rourke
pointed out, the main objective for GoodGuide is to gain people’s trust and become
credible.11 One false rating could challenge the credibility of the entire company.
However, how easy is it for GoodGuide to provide a “false” rating? The first issue thatcomes to mind is the subjective nature of the rating. Since it is not quantifiable per se,
how easy is it for a third party to say whether the rating is false or not? Could
GoodGuide simply argue that the rating is subjective, based on its staff’s assessments,
and therefore not really false? Would this argument affect the credibility of the company?
Another point to consider is the feasibility of actually verifying GoodGuide’s
ratings. Consumers, for example, could not easily confirm the accuracy of the rating.
They do not have access to the raw data, and if made available it would require extensive
time to analyze. So, we can infer that the likelihood of being verified or called-out by
consumers is extremely low. Manufacturers, on the other hand, have access to the fullproduct and manufacturer information, so they are in a position to verify the information,and could potentially call-out GoodGuide if it were indeed falsely rating one of the
products. Governments, too, have access to significant information and could potentiallyinvestigate the company and question the legitimacy of the ratings.
We can surmise that GoodGuide has much to lose by lying; however, questioning
a subjective rating method is quite difficult to do. Yet more challenging is accessing the

11

Phone interview with Dara O’Rourke, 20 November 2008.

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information and data required in order to verify the ratings, therefore, it is not likely to bedone by consumers.

Conclusion:
This paper examined the accuracy and reliability of GoodGuide’s rating method
for household products. Additionally, the paper questioned the credibility and legitimacyof the company. At first glance the company appears to be conducting extremely
thorough research in order to analyze products and manufacturers in three categories:
health, social and environmental impact; however, very little information is provided on
the website that explains the steps taken in this process of evaluation. The lack oftransparency, specifically related to
GoodGuide’s rating methodology and data sources, as well as its governance andfunding, all affect the perceived credibility of the company. As a company with a
mission of providing accurate and trustworthy data, I recommend it focus on clearly
explaining how it does this and how the company is managed. We recognize that this canbe challenging given the complexity of the work involved; however, it is the only way
that GoodGuide can gain consumer’s trust in the long-term.

Copyright 2008. No quotation or citation without attribution.

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Discussion Questions:

1. How can the company find the balance between providing enough information to the
public and maintaining a user-friendly approach?
2. What additional information should GoodGuide provide on its website to beperceived as trustworthy by consumers?
3. What are the advantages and disadvantages for GoodGuide of being incorporated as afor-profit company?
4. Does being certified as a B Corporation make GoodGuide more or less credible?
5. Dara O’Rourke is the driving force behind GoodGuide. Would the company be morecredible if it weren’t perceived as a one-man-show? How so?
6. What other incentives to mislead exist for GoodGuide?
7. Should product quality and performance be a factor in GoodGuide’s reviews? Would
this add to the rating’s consumer appeal and credibility? How so?
8. The company’s complicated rating system remains somewhat obscure. How could
this challenge be overcome? Does this obscurity affect the credibility of GoodGuide?
9. Do you trust the company’s data sources? Why or why not?
10. Do you trust and feel confident in GoodGuide’s ratings? How so?

Copyright 2008. No quotation or citation without attribution.
Appendix 1: GoodGuide Sub-Categories
Health Performance:• Cancer Effects• Reproductive & Developmental Effects• Short-Term Health Effects• Long-Term Health Effects• General Health and Safety
Environmental Performance:• Toxic/Hazardous• Climate Change• Energy• WaterSocial Performance:• Philanthropy• Customer Satisfaction• Employees/Related Workers• Labor & Human Rights

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Copyright 2008. No quotation or citation without attribution.

Appendix 2: Sample Product Rating

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Copyright 2008. No quotation or citation without attribution.

Appendix 3: Good Guide Staff and Advisors

Staff:
Total eleven (11) full-time staff, including:
Dr. Dara O’Rourke, Founder, GoodGuide
Five (5) scientists
Five (5) engineers
Science advisors:
Dr. Ann Blake, Environmental and Public Health Consulting
Dr. Rhonda Evans, ELM Research
Dr. Archon Fung, John F. Kennedy School of Government, Harvard University
Dr. Arpad Horvath, UC Berkeley
Dr. Alastair Iles, UC Berkeley
Dr. David Levine, Haas School of Business, UC Berkeley
Dr. Rachel Morello-Frosch, UC Berkeley
Dr. Peter Evans, UC Berkeley
Dr. Greg Norris, Sylvatica Consulting
Caitlin Merlo, Registered Dietician
Technology advisors:
Mike Cassidy, CEO LocalPoke
Joel Truher, Former Engineering Director, Google
Dr. Jeff Heer, Stanford University

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