Most of us believe we know the difference between right and wrong. Unless our aim is explicitly to take advantage of others, then we believe we can generally identify and do the right thing. And even if exploitation were our prime objective, we’d probably still know, deep down, that it’s not the right thing to do.
But there is clear and mounting evidence that when some groups of people get together, their ability to identify and do the right thing faces a very real risk of breaking down. How else to explain the issues exposed within the largest financial institutions in this country?
Some of the most serious issues exposed in the financial planning arms of these organisations appear to originate in a culture which either encourages – or fails to penalise – unethical behaviour, or which does not recognise what unethical behaviour is to begin with.
If financial planning is to ascend from industry to profession, then there has to be widespread acceptance among practitioners that not only do ethics matter, they must be accepted and lived up to by all practitioners, and penalties enforced when they are breached by those who do not, or choose not, to measure up.
Dr Simon Longstaff, executive director of the St James Ethics Centre, says that among some groups of financial planners, and in some large organisations: “I am sure there are cases where [unethical behaviour] is condoned. But probably behind the scenes, away from the glare of the public view, there would be in some cases quite a bit of soul-searching,” he says.
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Behavioural mutations
“What you typically find when you go inside these organisations is there was an element or some part of the business where a mutation took place in the values and principles. So instead of having trust [as a principle], people started saying, ‘cunning is a bit better for us’.”
Longstaff says the ethics an individual subscribes to as a professional should guide their behaviour irrespective of what they see going on around them. And if what they see does not accord with their ethical obligations or beliefs, they should take action. If they cannot encourage changes from within then “ultimately you’ve got to say, ‘I’m not going to work here’, and you’ll leave”.
“Which is not to say that everyone should throw themselves onto the funeral pyre of integrity, because all you end up doing is making a few brief, beautiful sparks and you’re gone,” Longstaff says.
Not destined to become roadkill
“You need to be far more strategic. I think some people think being ethical is like being this little fluffy rabbit that people like to pat, and you sit on the roadway of life and the big truck called reality is bearing down on you, and your last pat is just before you’re destined to become roadkill. It’s not like that at all.
“Ethics is about being nimble, engaged and looking at the world and finding ways to change it so you can achieve your own objectives – your values and principles. It’s about not being a prisoner of the way things happen to be.”
Dr Deen Sanders, chief executive officer of the Professional Standards Councils, says that the ethical standards expected of a professional community are ultimately embodied in a profession’s code of ethics. This is more than a list of commandments or prohibitions; a good code underpins a “living, breathing improving professional system”.
The role of codes and associations
“Codes of ethics, as a vehicle by which [a professional] community negotiates what is expected of it, is an opportunity to open that whole conversation up and lay it on the table and say, ‘this is what we think you do and what we think you should do; what do you think about it?’,” Sanders says.
“An association is often the vehicle for that. It doesn’t happen spontaneously from within the market. Usually there’s a driving influence, a body – an entity, as we call it – that is the engine behind getting that conversation started.
“Sometimes it’s only a group of four or five like-minded individuals who gather in a room and say ‘let’s write this thing down’. That’s how professions usually start: ‘let’s say what we think is the right thing to do’.
“But ultimately, from a government and regulatory perspective, it needs more than just a couple of like-minded people.”
No chocolate for youSimon Longstaff, executive director of the St James Ethics Centre, says there is an accepted hierarchy of duties that a professional owes. The first is to society, “then there’s a duty to your client, then there’s a duty perhaps to your profession, and on the bottom rung is your duty to yourself”, he says. “That’s why a lawyer has an overriding duty to the court, which comes before their duty to the client, and then to the profession, and ultimately to [themselves],” he says. “To make the distinction clear: if a person is looking for some chocolate, and they’re working to a paradigmatic example of the market – which is a corner store – the only question the shopkeeper has is: can that person afford to buy the chocolate? They stump up; “I’d like some chocolate; here’s some money”; exchange; and away they go. “If exactly the same person were a diabetic and they walked into their doctor’s surgery, the doctor would have no hesitation at all in saying, ‘I know that you want chocolate’ – which is what the market would satisfy – ‘but my duty is to serve your interests; and it’s not in your interests as a diabetic to provide you with chocolate. Therefore I will not give it to you.’ “On both counts the transition from being a member of a market guild or union, or some group, into the professions is a major, major change, because all of the world in which we live, for the most part, is operating according to the market ideology of pursue your self-interest, leave it to 09 the invisible hand, satisfy wants, and you’ll be fine.” |