This Little Antique called Ethics

Business is a simple thing. According to Cambridge Dictionary it is just the activity of buying and selling goods and services. As with all simple things you can do them right or wrong. Or in other terms ethically or unethically.

Unfortunately humans tend to overcomplicate things. Something that should be black or white is being consumed by lots of grey. And we love grey. Grey allows us to think, that even if we are not necessarily following ethics in business, we are not – at the same time – unethical. We just sail over the ocean of grey, and create complex rules allowing us to navigate stormy waters without hurting our conscience.  

And waters are stormy for it is something in our nature, that is strong and primeval: greed.

Greed is good

Older readers would recall famous quote from the Oliver Stone movie “Wall Street”. Gordon Gekko, portrayed aptly by Michael Douglas says at one point: “Greed, for lack of a better word, is good”.

Now back in 1987 Gekko’s speech was meant to be a powerful warning against pitfalls of capitalism. Instead it became a theme played all too often in corporate boardrooms and investors' meetings. The role catapulted Douglas to stardom and secured him an Academy Award. Meanwhile real Wall Street was gearing up for the last act of preparations to the financial crisis of 2008.

Because Gekko was not some imagined character. He was created in the image and likeness of existing figures. And speech about greed was delivered to none other but students of the School of Business Administration at the University of California, Berkeley. Ivan Boesky said "Greed is all right, by the way. I want you to know that. I think greed is healthy. You can be greedy and still feel good about yourself.”

Newsweek magazine, in commenting on that speech, said: ”The strangest thing, when we come to look back, will be not just that Ivan Boesky could say that at a business-school graduation, but that it was greeted with laughter and applause.”

Shortly after Boesky was fined for insider trading by the Securities and Exchange Commission. He paid the $100 million and spent a few years in prison. But corporate America continued to do what it can do best: money.  

 Ocean of grey

We can safely assume that neither fictional Gekko nor real life Boesky have taught Wall Street anything. A lot of pompous corporate leaders and their henchmen were pushing world of finance towards a disaster we all came to know as 2008 financial crisis.

But my essay is not about that most obvious fallout. I would like to concentrate on ethical consequences of this epic disaster.

And they were… none.

The corporate world has learned nothing and we still witness relentless pursuit of profit. For profit became idolized beyond reasonable limits. Now of course it has nothing to do with greed. Greed is no longer good. Now it has new fancy names: profitability, responsibility and sustainability.

It has all to do with “ability”. Ability of the corporate world to adapt to new rules. It is not enough to follow noble path of CSR. Now you have to also implement ESG. These are TLA’s (three letter acronyms) that replaced good old-fashioned ethics.

Codes of (mis)conduct

Corporate rules of engagement are very important. I am not here to complain about them. But I would like to warn you: no amount of codes replaces ethics. And this is the fundamental rift I see between corporate and real world.

Because if ethics is important to you – you do not condone gender pay gap, racial, gender or age bias, mobbing, pollution of environment, unfair treatment of work force or business partners right?

In ethically run business this things just cannot happen or otherwise it is an unethical business.

In ethically run business you do not need three letter acronym prosthetics. You just do the right thing.

Is it not striking you, that in spite of all this corporate paperwork, CSRs, ESGs, codes of conducts we still see gender pay gap, racial, gender or age bias, mobbing, pollution of environment, unfair treatment of work force or business partners?

Did it ever occur to you that we try to treat symptoms, not the cause?

That all what is wrong with business comes from relentless profit chase, without consideration for much else?

Yes. Profits are important as only profitable company can serve honestly its shareholders, employees and other stakeholders.

But greed, for the lack of better word, is NOT good.

Ethics is a simple thing. According to Cambridge Dictionary it is just the study of what is morally right and what is not.

Simply put the world does not need more corporate TLAs.

It needs less grey and more ETHICS in business.