Tuesday, June 24, 2008
Bear Sterns' scandal's deeper impact
|It’s becoming increasingly difficult to open the newspaper each morning. As I have been discussing in this blog, the suffering economy and through-the-roof prices on fuel have put a damper on our current financial situation. I didn’t even have to open the paper last week to discover the indictments of two former Bear Stearns hedge fund managers who are charged with misleading investors. The headlines jumped out of the front page, and I realized the financial decision these managers made have contributed to the global crisis we now face, not to mention the billions of dollars it cost their investors.
The indictment is based on e-mail correspondence between the two men that reportedly are a clear indication of their knowledge of the declining state of the hedge funds. As I absorbed the details of the case, I grew extremely concerned about the current business environment, not only from the perspective of a banker, but perhaps more importantly from the perspective of a father.
While we all wish financial success for our children, it would be a shame to let them grow up believing that successful business and good ethics are contradictory. The Bear Stearns fiasco is one example of how a lack of integrity and character negatively effected an organization, as well as the entire economy. Just as teaching kids to be street-smart and money-wise is important, teaching them the value of ethics is a vital part of their education especially during difficult times. The economic crisis is testing the core beliefs of financial executives today and I hope to instill core values for my kids to guide them when they are faced with difficult decisions. My desire is for each of them to be guided by strong values so that when they are challenged to make a choice, they will choose the road less traveled rather than selfishness and greed.
Although it often feels as though displays of honesty in business are rare these days, I also realize ethical businesspeople just aren’t considered front-page news. While corruption and dishonesty can lead to the decline of entire institutions and the loss of billions of dollars, those that implement ethics in their business plans are the ones that allow for “business as usual.” Although the topic of ethics isn’t always a headliner, it is certainly crucial to consider in all industries and levels of business and one of the most important values to instill in our kids.