Business and morality - an unlikely combination?

The Big Four have been a little money-hungry lately
A few years ago I did one of those personality type indicators, called Myers-Briggs.

Apparently, if you answer about 150 questions, these two theorists can extrapolate what your personality is like.

I emerged as an ENFJ.

Take note of the third one – F stands for feeling. Apparently you can be a ‘feeler’ or a ‘thinker’. The example the course leader gave was this: Let’s say you’re the CEO of a company and you need to fire someone. How do you decide who gets fired?”

The feelers embarked on a long process of trying to work out which employers didn’t have a family, who would be most financially affected, who would be the least disenfranchised about the decision etc.

The thinkers, on the other hand, were fairly ruthless. They wondered who had been underperforming from a business perspective and, regardless of their life situation, they would be the one who was fired.

You see, the thinkers approached the situation purely by examining the cold hard business realities. They judged that the business needed to remain profitable so the biggest barrier to that would be cut loose. On the other hand, the feelers tried to put themselves in the person’s shoes and sensed what they might be feeling.

It’s a fascinating subject of study because a question I’ve been pondering more and more lately is, how much should we expect businesses to behave in a morally ‘right’ manner.

The best example of this at the moment is Australian Big Four banks refusing to pass on a cut in the official cash rate by the Reserve Bank (As this column went to press, ANZ and NAB were the only two 'big banks' to have dropped their interest rates, but only after a fair bit of public backlash).

The front page of several Australian newspapers called, aggressively, on the banks to ‘do the right thing’ and lower their rates.

The problem here is, the banks are under no obligation whatsoever to do this. They’ve all made a calculated gamble that by not lowering their rates, they’re not putting themselves in danger of losing customers and ensuring they remain profitable.

Isn’t this what any good CEO would do? Surely the first pledge of allegiance a CEO makes is to do the best by their business rather than by the family of four in Sydney’s western suburbs.

Yet so much media commentary has talked up the fact that the banks are ‘heartless’, and don’t understand the cost of living pressures working families are experiencing.

What I find interesting is that, (and I’m speaking very generally here) for the most part, the people who are most outspoken about how evil the banks are, come from backgrounds with no executive business experience. While those who quietly endorse the banks, more often than not, come from executive positions.

I’m not saying one position is right and the other is wrong. Rather, it’s fascinating to see how people with different life experiences cast a moral judgement over the business decisions of people who, often, they’ll never have met.

I might pick this up next week. In the past few weeks we’ve seen societies all over the world cast morally black or white judgements over all sorts of decisions (pokies reform, same sex marriage, climate change etc.) and I’m getting a little frustrated by it.

So stay tuned for next Friday’s column.


Steve Garner said…
Before getting into the discussion we should get the facts right. “…at the moment is Australian Big Four banks refusing to pass on a federally decreed interest rate cut…” The banks weren’t refusing to cut rates; they were taking a few days to consider their position. It wasn’t a Federal Government interest rate cut; it was a cut in the official cash rate by the Reserve Bank. (The Reserve Bank is independent of the Federal Government.) The Federal Government hadn’t decreed anything. They don’t have the power to do so. Instead they were playing politics by bashing the banks, always a vote winner.
Dylan Malloch said…
You're right re: Federally decreed rate cut. Sloppy language on my part.

But I'd suggest 'refusing to pass on' and 'taking the time to consider their position' is just semantics.