20th Dec 2011
Stephen Green, Good Value: Choosing a Better Life in Business (London: Penguin, 2009), xii 212 pp.
Ordained in the Church of England and former Chairman of HSBC, Stephen Green offers us these choice cuts:
‘There has been a massive breakdown of trust: trust in the financial system, trust in bankers, trust in business, trust in business leaders, trust in politicians, trust in the media, trust in the whole process of globalization – all have been severely damaged, in rich countries and poor countries alike’ [xi].
‘A large part of our quest as humans is to explore what we can come to accept as our “home” in the profoundest sense, for that is where we will discover our true spiritual purpose’ [18].
‘Compartmentalization – dividing life up into different realms, with different ends and subject to different rules – is a besetting sin of human beings’ [18].
‘Compartmentalization is a refuge from ambiguity; it enables us to simplify the rules by which we live in our different realms of life, and so avoid – if we are not careful – the moral and spiritual questions. One of the most obvious and commonplace manifestations of the tendency to compartmentalize is seeing our work life as being a neutral realm in which questions of value (other than shareholder value) or of rightness (other than what is lawful) or of wisdom (other than what is practical) need not arise. But there are many other ways in which we compartmentalize our lives. Work, family, friends, society – these are different (though often partially overlapping) realms of life, and it is all too easy, in a thousand ways, to play to different rules in each of them. These different realms of being also overlap with the inner realm of the self (though none of them completely): by what star does that inner self navigate? And would it even know when it is off course? Compartmentalization helps to shut such questions out’ [18].
‘He [Calvin] wrote, “Usury is not now unlawful, except insofar as it contravenes equity and brotherly union”’ [69 quoting Institutes IV, 20, 18].
‘Urban transformation of the world is the most important social, political and cultural consequence of globalization’ [89].
‘Cities embody the drive of humanity for connectedness – for society, convenience, stimulation and wealth’ [90].
‘London is the world’s purest example of a world city: it is quintessentially organic, open and kaleidoscopic, and constantly growing outwards culturally from its deep roots in the past’ [94].
‘When the history books are written about this period [the 2008 financial crisis], I believe they will miss an important dimension if they do not focus on the pervasive stress and sheer tiredness of those involved – whether policymakers, regulators or bankers’ [120].
‘Confidence is followed by foolhardiness, then by fear followed by a crash, followed by witch-hunts – and eventually by renewed growth. The human emotions appear to repeat themselves: the greed, the panic, the shame and anger, remorse and sobriety – until exuberance reasserts itself’ [124].
‘What is progress? Is it the accumulation of wealth, or should it involve a broader definition of the quality of life which takes into account a more integrated understanding of well-being. Surveys consistently show that economic progress has not been accompanied by the expected improved level of happiness, and that the price paid for it by many has been the quality of human relationships. On average, people do not think of themselves as happier or better off than their parents were – even though the material standard of living is, in so many societies, unquestionably higher. And there has in particular been a marked decline in the sense of trust. The collapse in perceived trustworthiness is obvious with respect to the banking sector, but also applies to business more broadly – as well as in family life and in social relationships generally’ [131].
‘The word “credit” derives from the Latin word credere, meaning “to believe”. So a credit crisis is, by the very meaning of the word, a crisis of confidence’ [132].
‘If we are to restore trust and confidence in the markets, we must therefore address what is at its root a moral question … It is as if we have grown increasingly to accept the idea that the value of what we do is fully delineated by the market, by regulatory compliance and the law of contract. If the market will bear it, if the law allows it, if there is a contract, then no other test of rightness need apply. Yet we would not (or should not, at least) live our private lives this way … What has happened is that we have succumbed to the sin of compartmentalization … As individuals we do not govern our behaviour simply by what is allowed by law or regulation. We have our own codes of conduct, and hold ourselves accountable. We take responsibility for our actions. The institutions of capitalism – businesses, banks, and other institutions of the financial markets – have to do the same. This is the sine qua non for the restoration of public trust in the market, and is therefore essential for the overall health of society’ [132].
‘If everything is defined by price, not value, then surely social fragmentation follows, since all that matters is a supply of cash rather than shared blood, community, friendship, or beliefs’ [136].
‘It [microfinance] may not make people rich; nonetheless, it is profoundly transformative’ [144].
‘The response [to what has gone wrong] has to be renewed commitment to the real task of sustainable value maximization. And it is clear that this has four elements. First, there is of course the direct and basic responsibility to earn as good a return as is sustainably possible on the capital entrusted to the company by its shareholders … And, second, … in order to earn the best return over time, businesses need to nurture their customer relationships and service … A third element of value maximization – the way a business engages with its people – takes us straight into the realm of sustainability and corporate responsibility … The fourth element of sustainable value maximization is therefore the way in which the business engages with the communities in which it operates’ [155-156].
‘There will always be those who have not merely more than others, but more than they could conceivably need. There are only two possible responses to this fact for those of us in this position: we can, in effect shrug our shoulders; or we can hear the still, small voice of conscience. That voice reminds us – if we listen – that something is owed by the affluent. And a debt not paid makes a debtor who is guilty. Hence that voice. We often hear affluent people speaking of wanting to “give something back to the community” – the very phrase conveys a sense that something is owed. At its worst, this response may be little more than a transaction à la Melmotte: doing something because it is expected, and because it wins social points. In which case it is simply one more transaction of the kind discussed by Simmel – the objectification of human relationships through the medium of money and exchange. At its heart, this is not giving back what is owed: rather, it is a transaction which is an investment.
‘At its best, though, a different – and deeper – form of transaction takes place when we respond to that voice. The giver discovers that his or her spirit becomes involved, and may then even experience an inkling of a sense that the debt is not just being repaid in the giving, but being forgiven. And the sense that the debt is forgiven in the giving can then bloom into a sense that the debtor is forgiven – for all the imperfections through which the affluence has been generated, and for all the presumption that the affluence may have generated in its time’ [159].
by Jon Horne
