economic crisis: it’s about ethics

“The economy is in crisis”, the televisions at the gym blared. “you may no longer be able to afford that SUV.” “Due to the economic crisis,” read the printed signs at the fast food restaurant, “our sub sandwich supreme has doubled in price. We regret any inconvenience this may cause.” “Because of the economic crisis,” burbled the talking heads wearing corporate-looking suits, “we have had to reduce our workforce by half.” We all remember, right? Whose idea was it to have an economic crisis, anyway? It may be a better question than you think. Who plans ahead for misery? We all do, it turns out—when our actions are driven by a “concept of self-centered materialism”, as recently stated by members of the European Baha’i Business Forum.

Any response to the world economic crisis must address ethics, given that the crisis is “fundamentally one of trust and integrity,” the European Baha’i Business Forum said in a statement published last week. Furthermore, the situation requires an ethical response “at all levels” – from individuals, from corporations, and from governments and regulatory entities, said the statement, released as some 400 representatives from dozens of countries and organizations gathered in Geneva for a two-day Global Ethics Forum.

“We need to replace the concept of self-centered materialism with that of service to humanity,” the EBBF said. Cooperation must replace competition, the statement continued; ethical behavior must replace corruption, gender balance must replace sexism, world unity must replace protectionism, justice must replace injustice.

I remember having a talk with my boss at the Conference Board—one of Canada’s powerhouses in the business of economic research—during the time the fearful words “economic crisis” first hit the news screens, as we walked into work in the morning. The conversation revolved around what makes, or causes, an economic crisis. The conclusion was pretty similar to the one reached above by the EBBF in their statement: it’s about ethics. When people get into the habit of doing business unethically—by selling products (like mortgages, loans, etc) with exploitive terms, or otherwise cheating their clients—the system they put together will end up failing. When this situation arises in a business that relies so strongly on trust as the financial industry, the impact of that failure will naturally be much bigger. People do more business with people they think they can trust; if that trust is then broken, the chaos created as those people pull back out will naturally seem like a “crisis”. In contrast with most of the Western world, Canada’s economic system emerged into the first quarter of 2009 relatively unscathed—because Canadian banks, unlike their American counterparts, had long observed a policy of conservative lending that precluded the sort of unethical lending rampant in the American banks. Honesty is like a magnet: observe it and you will create a strong and stable network around you; disregard it and everything you build will crumble.

Read the Baha’i World News story.

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