The Harvard Business Review recently published an article on their blog that takes a stab at what happened with Sokol and the Lubrizol affair:
The far more interesting question from our standpoint is why Warren Buffett, known for his embrace of ethical business practices, failed to understand the unethicality of Sokol’s actions when he learned of them, and intervene. Had Buffet suddenly gone over to the dark side? Or, as Berkshire portrayed the story, did Buffett do absolutely nothing wrong?
[M]ounting research shows that we often fail to notice others’ unethical behavior if it’s in our interest not to notice. This failure of oversight — called “motivated blindness” — is unconscious and common. When Sokol told Buffett that he owned stock in Lubrizol, Buffett probably didn’t consciously ignore the warning signs; he didn’t see them at all.
Read the full article here.