HomeBusiness DigestThe Human Capital Telescope: The case for business ethics

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Last week’s piece interrogating the quality of the Zimbabwean Master of Business Administration (MBA) degrees generated some intense intellectual combustion. Debate  was around the role of business schools in inculcating ethical values among their graduates. Many of these graduates eventually become the elites of business, either making decisions or contributing to the granary of business wisdom from which business decision-makers draw, moving and shaking economies in the process. To a large extent, global stability is now inextricably tied to the ethics of business elites as evidenced by recent financial and economic crises.

Knowing-doing gap

A point that was raised in the debate could be summed up as the knowing-doing gap. This is the idea that unethical business decisions are made in spite of cognisance of ethical values. Some of the arguments for the knowing-doing ethics gap are the weakening of primary social institutions that are assumed to be the vanguards of formative moral and ethical development.

 

It is argued business schools can only play a secondary role in buttressing ethical values that a society has already inculcated during child upbringing. If a society has embraced post-modernism—where situational or relative ethics are accepted, should a business school be blamed if its graduates pay bribes in a country where bribes are taken as the norm? Are ethics absolute? We shall turn to ancient Near East business philosophy for alternative insights on business ethics.      

   
Anti-greed

Foundational to the business philosophy of the ancient Near East was anti-greed—a barrier to unethical business practices. This anti-greed principle is captured in the Book of Proverbs, a treasure trove and  compendium of generally-accepted business principles of the ancient Near East BC era. Proverbs 11:24, 25 states: “There is one who scatters, and yet increases; and there is one who withholds more than is necessary, but it tends to poverty. The liberal soul shall be made fat: and he that waters shall be water also himself.’’ 

The principle of anti-greed continued to hold sway in the ancient Near East at the beginning of the AD era as evidenced by Luke 6:38: “Give, and it shall be given unto you; good measure, pressed down, and shaken together, and running down, and shaken together, and running over, shall men give into your bosom. For with the same measure you give with it shall be measured to you again.”

The principles espoused in the foregoing shake the very foundation of modern business practice—the unbridled desire to accumulate. Lest someone get the impression that ancient Near East business philosophy was against profit and business growth, the exact opposite applied. Ancient Near East business philosophy was for-profit. However, it proffered a radical formula that cut against what contemporary business schools teach. It advocated for business growth through generosity and fairness. It suggested that there was a correlation between generosity and business growth. Intellectual honesty dictates that empirical research should be done to test these axioms in the modern business environment.

Closer to home, Econet’s brand equity is undoubtedly much more than its revenues, making its brand equity to GDP ratio much higher than a conservative 6%, based on revenue alone. That’s a very huge anomaly when contrasted with the top 10 Interbrand ranked US firms that contribute combined brand equity to US GDP of 3,1%. 

 

One possible explanation to this anomaly resides in Econet’s perhaps unwitting tapping into the ancient Near East generosity-reciprocity business laws through its long-running programmes of assisting needy students. We see an awakening of global consciousness around corporate social responsibility (CSR). That global consciousness is a belated epiphany.

 

The principles of CSR were already practised in the ancient Near East 4 000 years ago under the compass of generosity. Service and fairness to fellow men and the environment was the foundation of business then, not its derivative or afterthought or mechanism to soften or salve the pricked conscience of capitalism.

Ancient Near East business philosophy advances the business case for fair remuneration as a guardian of both business and societal stability. James 5:4,5 spells out the eventuality of remuneration inequity: “Behold the hire of the labourers who have reaped down your fields, which is of you kept back by fraud cries: and the cries of them which have reaped are entered into the ears of the Lord of sabaoth.

 

You have lived in pleasure on the earth, and been wanton; you have nourished your hearts, as in a day of slaughter.’’ Wasn’t the recent global economic crisis a consequence of crass greed and inequity as evidenced by excessively high salaries and bonuses of top executives?

Ancient tycoon testimony

The Biblical Job, a tycoon and a ‘Fortune 100’ member of the ancient Near East, demonstrates how deeply ingrained the business generosity philosophy was in the ancient Near East business psyche. The tycoon testifies: “When the ear heard me, then it blessed me; and when the eye saw me, it gave witness to me: Because I delivered the poor that cried, and the fatherless, and him that had none to help him. The blessing of him that was ready to perish came upon me: and I caused the widow’s heart to sing for joy. I put on righteousness, and it clothed me: my judgment was as a robe and diadem. I was eyes to the blind, and feet was I to the lame. I was a father to the poor: and the cause which I knew not I searched out.’’ (Job 29:11-16).  Need I say more?

Wealth through ethics

Wealth through ethics was a highly esteemed principle underpinning ancient Near East business practice. Neither cook nor crook was countenanced. Honesty and hard work in business practice were celebrated. Easy money and get-rich-quickly devices were frowned upon. The maxim in Proverbs 13:11 sums up the thesis behind castigating serendipitous wealth: “Wealth gotten in haste shall be diminished: but he that gathers by labour shall have increase.”

 

Wasn’t the collapse of the global financial system in 2008 a direct result of the violation of this principle? Isn’t the Eurozone debt crisis a direct result of a desire to make easy money (bonuses) through doling out loans to risky borrowing sovereigns? Tremendous scholarship and research has been dedicated to tease out the correlation between greed and lack of ethics and the global financial crisis.

 

For instance, looked at objectively, financial derivatives such as credit default swaps in the mortgage market were a get-rich-quickly stratagem that blew up in our collective global face. Did we not as Zimbabweans ‘burn’ ourselves when we spent time ‘burning money’ in 2008?  Sample this: “The getting of treasures by a lying tongue is a vanity tossed to and fro of them that seek death.” (Proverbs 21:6).  In Proverbs 11:26, 27 we read: “He that oppresses the poor to increase his riches, and he that gives to the rich shall come to want.’’

Wealth through ethics, the paragon of ancient Near East enterprise virtue, appears to have for a long time eluded the so-called flagship contemporary business school.

 

Let’s discuss at brettchulu@consultant.com.

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