Pearson Education Can Run, But It Cannot Hide
Bad news for Pearson Education may be good news for the rest of us. The testing and publishing mega-giant is on the run, but it looks like it will not be able to hide. Pearson Education is closing its foundation; it is under investigation by the FBI for possible insider dealings in the Los Angeles iPad fiasco; the company is being sued by former employees for wrongful termination; and its PARCC exams are losing customers.
(A) Pearson's Foundation Closing
Pearson has tried to give it a positive spin, but the reality is that Pearson the for-profit company is closing down its partner not-for-profit Pearson Foundation after having trouble with the law in both New York and California. In 2013, the Pearson Charitable Foundation paid $7.7 million in fines in New York State to reach an out-of-courtsettlement after the Office of the State Attorney General found the Foundation had broken state laws by generating business for the for-profit company. According to thesettlement agreement, "The Foundation's staff has consisted of Pearson employees; the Foundation's board was comprised entirely of Pearson executives until 2012; select Foundation programs have been conducted with the advice and participation of senior Pearson executives; and the Foundation continues to rely heavily upon Pearson Inc. for administrative support." While the Pearson Foundation neither admitted to nor denied the charges, it agreed to pay the fines.
Pearson has tried to give it a positive spin, but the reality is that Pearson the for-profit company is closing down its partner not-for-profit Pearson Foundation after having trouble with the law in both New York and California. In 2013, the Pearson Charitable Foundation paid $7.7 million in fines in New York State to reach an out-of-courtsettlement after the Office of the State Attorney General found the Foundation had broken state laws by generating business for the for-profit company. According to thesettlement agreement, "The Foundation's staff has consisted of Pearson employees; the Foundation's board was comprised entirely of Pearson executives until 2012; select Foundation programs have been conducted with the advice and participation of senior Pearson executives; and the Foundation continues to rely heavily upon Pearson Inc. for administrative support." While the Pearson Foundation neither admitted to nor denied the charges, it agreed to pay the fines.
In September 2014, Annie Gilbertson, education reporter for 88.3 KPCC, Southern California Public Radio, uncovered emails that appear to show complicity between officials in LAUSD, Pearson, the Pearson Foundation, representatives of Apple, and America Choice, a Pearson affiliate, to influence a LAUSD contract decision and circumvent the bidding process.
This was followed on November 18, 2014 by an announcement by the Pearson Charitable Foundation's Board of Directors of their "intent to cease Foundation operations and close the Pearson Foundation at the end of the year." They claimed that Pearson Education no longer needed "the Foundation as the primary vehicle for its philanthropic and community activities."
In an internal memo to Foundation employees that was passed along to me, Pearson promised to place many of them with other groups working on its projects and denied it was closing the Foundation "because it was unable to comply with the New York Attorney General settlement." It claimed that, "Over the last two years, Pearson has undertaken a review of all its business activities and investments, including its corporate responsibility activity. We feel strongly that there is significant potential to scale Pearson's social impact efforts by leveraging the full resources of our global operations, networks, and expertise." Maybe it is true; I just do not believe them, Pearson Education Can Run, But It Cannot Hide | Alan Singer: