I was at the Norwich Meeting House of the Quakers this morning.
It' s a lovely building, and a good meeting. Outside there's a memorial to Elizabeth Fry who was a member of the Quakers in Norwich and attended at that meeting.
But there's another part to its story worth recalling. This was also the Quaker meeting of the Gurney family who founded the bank of that name. As Wikipedia notes (and I think this fair comment):
The Quaker Gurneys were renowned for their honesty, reliability, and fair dealings – so people entrusted them their money for safe keeping.
In 1896 Gurney's bank became part of Barclays.
Could anyone really say the same of Bod Diamond's Barclays Bank? Honesty - when hiding in tax havens? Reliability, except in exploiting? And fair dealing, where I hardly need start?
What changed? That's easy to explain. The ethics went. The pursuit of greed took over.
The same is true of other former great Quaker businesses, like Cadbury's.
And the message is simple, and one we have to heed if capitalism is not to tear itself apart: ethics have to be at the core of business or it causes harm not good.
So how do we put them back? And how does business hear and understand that it is in its own self interest to do this?
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How naive. If you generate 1 pence of profit, it’s because somebody else paid you 1 pence more than it cost you to produce something. Where’s the ethics in that?
No, capitalism has never required it’s participants to act ethically. Greed is good Gordon Gecko.
I guess there had to be a first person to say it
He’s also the last
Because that’s the absence of ethics that is destroying capitalism – and which is seeking to take society with it
Unfortunately, Capitalists (or those who we mean when we say capitalists these days) don’t have to care about ethics. We can’t make them care and shouldn’t. We can try to encourage it, wisely or unwisely. Which isn’t to say that we can’t respond. I like the way regular Egyptians responded to their overlords. Unfortunately, They only got at their ‘local’ overlords.
I believe that Credit Unions may be the closest to this ideal in the contempory world of finance provision. We certainly pay the full amount of corporation tax on any earnings.
A company will only act ‘ethically’ if the people who run it decide to, and unfortunately it’s evident that integrity and transparency are lower down the list of priorities than the pursuit of profit. Companies will only suffer reputational damage for acting unethically if compaines, societies, and others who trade with it refuse to do so as a result, but this requires those other actors to also place integrity and transparency above their own pursuit of profit. So to summarise, companies will only begin to act ethically when the majority choose to no longer tolerate unethical behaviour. A big ask…
A much more likely outcome is that the government (as it already does, on occasion) uses the tools at its disposal (tax, regulation and other laws) to encourage ethical behaviour, and discourage/punish unethical behaviour. In the absence of a global shift in personal and corporate priorities, it is only governments that can make unethical behaviour unprofitable, and likewise ethical behaviour profitable, and continuously reinforce this connection.
And who knows, maybe in them doing so they could slowly influence the underlying attitudes of the whole, and demonstrate that ethical behaviour is better for all of us. Of course, this requires politicians who value integrity and transparency more highly than profit…