A Valuable Exchange at the Royal Exchange
by Tanya Barman
Posted: 21 Jun 2012
May saw the launch of the CGMA ethics theme, and in the week we released our key report I attended an event at St Paul's Cathedral. Michael Sandel was exploring the moral limits of the market. The "congregation" was at full capacity at nearly 1800 as the issue was debated amongst a distinguished panel.
Two key themes are positioned for further
reflection, the first being What
things do you think money can't buy and, if you can't buy them, how can you get
This brought to mind a conversation following the debate at the Royal Exchange, which started life as a commercial centre in the 16th Century. Today it is somewhere you can eat and drink , and, for those who wish to after lunch, buy diamonds fromDe Beers.
Our excellent waiter who was shortly returning to Franceto adopt his true identity as a lawyer. So how had he found his time serving the financial movers and shakers? Sadly, at times he was rudely treated, looked down on and shouted at by customers in the wealthiest corner of our country.* We discussed what lessons he had learned and would take with him as he progressed through his career in the law. He had gained leadership insights. He'd placed value on the interactions and friendships he had built with the "good" customers, the collegiality and support of his wider team and management and was relieved that he wasn't like the angry, demanding individuals that unfortunately also coloured his day.
Was the 12.5% inclusive tip incentivising Antoine to be so pleasant? I doubt it. I think he had learned that treating people in a certain way brought with it returns and not only made their experience better, but also his working day. He had found a higher purpose, and a ripple effect, from his attitude. If he takes these attributes with him into is career I'm sure he'll find rewards beyond his fees. The value we place on others can have a larger effect on society. As raised in the St Paul's debate - ethical practice is not a limited commodity but a muscle that can grow and strengthen for the common good.
The evening at St Paul's had opened with the quote, "Today we are spending what we don't have, on things we don't need, to impress people we don't like". A clear critique. Instead we should invest in what will bring longer term returns, create products and services that add value and build relationships with those with integrity and courage.
The growth of the global market has brought benefits.It has raised many out of poverty, creates livelihoods and supports advances in health and education.Enterprise and access to funding, creating products, technology and services for the good and advancement of wider society has never been more necessary. But there are limits, risks and costs. Ask someone in Greece.
With the boom bust cycle is in a burst of bust - the second question arising from the Sandel debate is timely. What are the most important things you think money can buy, but shouldn't?
The growth in recognising the value of the non-financial aspects of business is accelerating. How businesses operate, in a fair and transparent way and by valuing people, will hopefully, in some, enlightened cases, arrest the now also increasingly negative effects of the markets. Our report highlights the need for a change in behaviours. Professor Sandel positioned this: behaviours change ideas, they change how things are done.
Financial reward for a job often, just done, remains in the spotlight. The connection between the bonuses for senior executives and the outcomes gained (and often losses accumulated) seem spurious. As packages increase so does a feeling of unfairness for "peers" who don't have an equivalent number of zeros and the spiral continues. Reward on the basis of the locker room: do these leaders not feel big enough without the wallet to match? Self esteem issues?
How can we instead connect leaders' additional reward to achieving a higher purpose. To feel satisfied in making an enduring difference to their business and wider economy and society? I think in the coming years the call for enlightened leadership, those with true virtue and wisdom will intensify. Personally I'd worry about a leader who gains, and retains, position on the basis of their so called "financial" worth opposed to character and fortitude? How about you?*During the 17th century, stockbrokers were not allowed in the Royal Exchange due to their rude manners, and had to operate from other establishments in the vicinity. Plus ca change.
The opinions expressed in this article are those of the author, and do not necessarily represent the views of St Paul's Institute or St Paul's Cathedral.