Ethics in a Recession - Make sure yours survive

Woolworths' administrator Neville Kahn (Senior Insolvency Partner at Deloitte) and serial entrepreneur Simon Bentley (Deputy Chairman, Mishcon de Reya and Chairman of Sports Direct International plc) locked horns with the audience at a packed room at an absorbing JABE (Jewish Association for Business Ethics) seminar which focused on the ethical issues relating to a recession.

Chaired by Maurice Moses (JABE chairman and partner at Ernst & Young) and hosted by Davenport Lyons, the event was organised by JABE and provided a platform for over 85 business people and professionals to openly and frankly discuss the issues thrown up by the current economic climate.

Debating the hot topic of government bail-outs, the panel were of the opinion that the government had very little choice in bailing out the banks. Insolvency expert Neville Kahn likened the banks to the plumbing in one's home "we all need heating and running water."

The expert panel were very vocal when tackling the reasons why the banks got into trouble in the first place. Dayan Abraham (JABE consultant and member of the London Beth Din) stressed the need for individuals to take responsibility and to not hide behind the corporate veil. "The Business world and the moral world cannot be separated. To forget one whilst practising the other is being derelict in one's duty"

Maurice Moses, also an insolvency practitioner, probed the panelists on other very topical and contentious issues such as pre-pack administrations and the difficult issue of what happens when a family business goes under - does one put the family before creditors?.

The bottom line for serial entrepreneur Simon Bentley was that "there are those who are ethical and those who are not, irrelevant of recession" and those with ethics will always strive to do the right thing.

When challenged about the ethical issues posed by redundancy and cutbacks, the panel agreed that the important thing was to do what was best for the business. They felt that this would benefit society in the long run and help steer businesses back on the right course sooner rather than later. However, where redundancies are unavoidable, it is important to treat staff with dignity and ensure they receive their entitlements.

The contentious issue of bonuses to investment bankers was raised by Maurice Moses, who suggested to the panel that the large amounts paid were deemed by bankers to be justified to enable the bank to retain its key employees, is a fairy tale world in the minds of the board of management "bonuses were unnecessary and inappropriate given the current situation we all find ourselves in."

In summing up Dayan Abraham stated that "ethical behaviour may well be the key to getting us out of the recession." He impressed on the audience the importance of Sanctifying God's name (Kiddush Hashem) in everything we do and that means acting properly and being seen to act properly at all times.

As a last thought, the Dayan stressed the need for all of us to continue to act generously towards charitable causes even in these difficult financial times.

The debate continues.

[February 2009]