In my strategic management class, my professor raised what he calls an "ethical dilemma." Meaning - whatever you choose (in this case) you may feel you are violating a promise you made to your employer and the people counting on to do your job OR you may feel you are violating a personal standard that you have set for yourself. We agreed as a class that there are good arguments for both sides - so my intent is not to prove that I am right in my choice, but in this case I feel that the following is the best decision for me. The scenario is thus:
You are the head of a commercial bank's loan department. You have committed to make good loans in order to maximize shareholder value. (It is, after all, THEIR money).
You have a middle man that brings you loans and it is important that you maintain a good relationship with him because he brings your bank business. He has brought you a loan that is considered "excellent" (i.e., great financials, great credit, great reputation for re-payment, etc)
This particular company engages in the production and sale of legal pornography.
Do you make the loan?
As the class was evenly divided, I enjoyed listening to people give their opinions and some were very adamant, and passionate about their views. (It was almost scary) There are some interesting people at BYU.
My initial reaction was that I would make this loan. As I thought more and more about the matter, I became even more convinced that making the loan was the right thing to do. The reasons for my initial reaction were:
1) I felt this loan would be made no matter what, so what difference does it make for society?
2) When you go into a bank and make a loan, the loan officer doesn't ask what you do in your personal life or what you do for work exactly. They may ask the name of the employer but that's all. They do ask how much you make, how long you have been working there, and credit history. As a loan officer - I don't care if you build multi-unit facilities for polygamists in southern Utah, support SI swimsuit edition (Disney), produce an alcoholic beverage, or produce legal porn.
These points were discussed in class and rebutted by arguments from the other side such as: personal values, ethics, social responsibility etc. (most students that espoused these points of view said they would quit the job because they would not be able to uphold their commitment to their dependents) These are good points, and I respect the other points of view on these grounds.
The professor was a mediator and didn't take a side. He then made the point that the very name for which our school is named (Marriott) owns a hotel chain that sells porn in their hotel rooms! Whaaaaaat? This threw some kids for a loop. What about Larry Miller who sales beer at Jazz games, etc...
So I thought deeper about the subject and wondered what some of the students were trying to accomplish by not making the loan. And furthermore, what more would they LIKE to accomplish if they had the power to do so? If we had (as an LDS community) a chance to vote to eliminate all evils from society like porn, alcohol, or even going to the store on Sunday, what would happen? Would we be better off, or worse off?
I would argue that we would be worse off. Growing up LDS I was taught that good cannot exist without evil. For that reason God allows evil to exist. I was taught that it is my God-given right to choose for myself between right and wrong.
I would prefer to have porn available to me at the Marriott and make the choice not to view it, than not have the choice at all. There is a certain pride and self-confidence that comes from having the liberty to make what each individual might consider a "good" decision.
So, I think we have a choice. We can go on a personal crusade to pluck every evil (option) from the hands of people, or we can be more proactive and educate each other about the dangers of all kinds of evil. (primarily by setting an example)
So, I would make this loan. Then I would make a charitable contribution to an organization that helps people to be more educated about possible negative side effects of porn or that helps people that suffer from any of the negativity that may be a result of porn (neglect, addiction, etc) in an amount equal to the profit of the loan proceeds.
Aaron's parable. Take away man's porn, he will be clean for a day, teach a man to see porn for what it is, and what it does, he will be clean for a lifetime. (obviously, this works for any evil)
Addition: another interesting thing to consider is how we might support evil-doing indirectly (like the example above) in our current jobs and just not know it. Where does the line get drawn as to what is ok and what is not? What if the loan was to a company that owned a bunch of companies and one just happened to be a porn company? Is it okay too deny this loan alone, or do you have to deny all loans that might have any connection to something you might consider bad? (e.g., alcohol, stores open on sunday, companies that promote working mothers)
...or we can just not worry about it and do what we are paid to do :)
12 comments:
This is a fabulous dilemma...is it immoral to drive away evil from the world (ahem, prop 8, etc.) when it clearly says in the good book:
"For it must needs be that there is opposition in all things...if there is no sin...there is no righteousness. And if there be no righteousness there be no happiness. And if there be no righteousness nor happiness there be no punishment nor misery. And if these things are not there is no God. And if there is no God we are not, neither the earth; for there could have been no creation of things, neither to act nor to be acted upon; wherefore, all things must have vanished away"
and
"wherefore, men are free according to the flesh; and all things are given them which are expedient unto man. And they are free to choose liberty and eternal life, through the great Mediator of all men, or to choose captivity and death, according to the captivity and power of the devil"
i like what you said about it all. i especially liked your parable.
Also, i'm really glad you wrote a blog again.
First of all, you were saying "sales" instead of "sells", Pshhh, what are they teaching you in college anyway.
Second, 5 months between blog posts is not acceptable.
Third, it's all your choice...I don't like how you said "the loan's going to be made anyway, so why not me?" Well, if you can live with that...then it's your choice and some may choose differently. I think of it this way. If you had a friend that was pressuring you into beating up a geeky teenager and you were hesitant...but then the friend says, 'well if you don't do it, then I will." So you think, what the heck, the kid's going to get beat up anyway, why shouldn't I just do it and look cool in front of my friends.
So, the moral of my story, YES, there needs to be opposition in the world, but we do not need to contribute to the opposition. That's Satan's job.
thanks - I changed it to "sells" :)
Sorry, this can be kind of confusing since there are so many implications. My point with saying that "the loan will be made any way" was just to point out that (all though you may think so) you are not doing society any favor by not making the loan. It is a "sunk cost" in economic terms - its gonna happen. So I don't think that should be a reason not to make the loan. So, by not beating the kid up - he is not any better off, he's gonna get beat up.
This is also a totally different situation for me. Here you are actually taking someones free agency away by overpowering them and inflicting physical pain. This is not the same moral dilemma for me. I would not produce porn either, even if someone else will make it if I don't.
But the dilemma lies with the fact you have committed to do a job. So you should either quit, or do the job.
I also agree that we shouldn't contribute to the evil in the world. My argument is that by making a loan you are not increasing the marginal evil that exists. That is important.
I appreciate your comments! These are fun things to discuss. Fulfill your commitment to your employer or quit? Hmmmmmm
I liken this to the controversy created a few years ago (see here and here) when some valiantly moral pharmacists decided to deny women birth control pills and emergency contraception, because they prayed about it and it felt wrong. can you imagine if pres. bush had used that about going to war in iraq? "It just felt right." oh dear.
Point is, i think those pharmacists were way on their high-horse by thinking their morals to be above someone else's. There was no way on earth the women they denied prescriptions to were going to just hang their heads and go back home and become chaste and abstinent. Rather, the pharmacy down the street got their business instead, and likely many of their friends as well.
The thought of pharmacists denying emergency contraceptives to women in need kind of makes me feel ill...so there's more of an emotional connection there than the porn loan issue. But i think it's along the same lines. Just in this case, it's psycho, chauvinistic, judgmental men trying to be moral authorities instead of a poor banker who worries about supporting the porn industry. But in both cases, they need to just suck it up and make their customers happy.
[...so much for my "be brief, be bright, be gone" blog comment philosophy]
p.s. and notice how the pharmacist in that 2nd link article got fired? He SO had it coming.
wow, that is interesting. I def. think those pharmacists should quit if they can't do the job they committed to do. If they do their job I don't feel like they are contributing to an evil act - but they felt that they were.
Why can't we all just live in harmony and sing songs?
Interesting read. First off, I'm kinda with Aubrey on the "it's gonna happen anyway" point. If you really believe making the loan is ethically wrong then the fact that another bank is going to make the loan is not a good reason to go ahead and do it.
I would give the loan because I think when you are in a position where you are providing some service to the public you should not discriminate based on personal beliefs of what is right and wrong.
For example, let's say we lived in a totally flipped society where porn is accepted by almost everyone as a good and wholesome industry that makes us better people. Then there's a guy who wants to start a business to promote awareness of the negative aspects of porn. What if all the banks denied this man a loan based on personal views? Wouldn't it seem unfair that this man couldn't start his business even though analysis of the loan showed it to be "excellent"?
The point is, I think freedom from discrimination, equal oppurtunity, freedom of speech, and just the freedom to do and be what you want(as long as it's legal, of course) is far more sacred than any personal beliefs of right and wrong I might have. This "freedom" is what makes America so great, it's like this shining orb of goodness that makes everything else work.
So if you're a loan officer, a pharmacist, or a photographer and you're providing some service to the general public you need to check your personal beliefs at the door and just remember what's REALLY at stake here. Do you really want that anti-porn guy in a parallel universe to die without ever having the opportunity to fulfill his dream?
Right, like I said, that was the very first thing that came to mind for me is that "it isn't going to make a difference for society." So, the important thing to consider is "is this something that is against my personal values?"
What I concluded is that making this loan is not against my personal values. (ONE, for the reason that you stated above, TWO, I feel like you can turn this into a positive (e.g., donation to "awareness").
Basically, I don't have a problem with pornography existing. I feel like making a loan would acknowledge that. I DO (personally) have a problem with producing it, selling it, financing it with MY money, and viewing it. But I HIGHLY value the right of others to do so.
If my shareholder's want to invest in this loan because it is an "excellent loan," I will respect that.
Another thing to consider is what happens if you don't make the loan? You are taking someone else's money and not doing what you said you would do with it. (make good loans)
Okay...
Get ready for some wisdom from your 50 year old father who has seen the good, bad and ugly of the world, made more mistakes than anyone and yes, happens to work in the banking industry! Ding!!!
I have to say that, although you took a very long time to post, you posted a real, thought-provoking zinger and since, traffic has slowed on my blog because of weird postings of Santa on a goat?! and continued boring political posts, I decided to jump ship.
But seriously, this is what i think. You have to separate the loan officer from the bank. The loan officer works for the bank and is responsible for making profitable loans whether they're moral or not and unusually the purpose of the loan is irrelevant except that the bank wants the money repaid. Since porn is a profitable business, if the business plan is good, it is probably a good loan, so the loan officer should make it.
Now, as for the bank, like any business, it has to be concerned about its reputation and bad public relations might cause people and other businesses to stop doing business with it.
Consider this analogy. What if Zions Bank, Utah's largest bank, decided to make a large commercial loan to fund a huge strip club in downtown SLC. Once the Mormon church and protesters found out, they would expose the source of funding as being the venerable, Utah-based bank that prides itself in helping to build the community since the early days of the Mormon pioneers. Not very good PR. Not very good business.
Therefore, morals and ethics do matter in business. Its not all about profit. And no, it isn't necessarily true that they will get the loan elsewhere. If the institutions that truly care about the community stick to their values, they won't finance or support activities that are a bad thing for society.
Now, this is much different than making a loan to the Marriot Hotel or a convenience store that might sell pornography as a sideline. It isn't their main business. You can't control all evil and you shouldn't try. It is a matter of scale.
If the business is in essence, a porn business, the bank shouldn't make the loan because it is bad for the community that the bank purportedly serves and that would be bad for the bank's reputation and ultimately for its long-term success.
By the way, a credit union would never make that loan!! :)
It is wrong to impose one's moral values on others but it is entirely right to choose to not support practices that one (including a bank) might consider immoral or bad for the society that it is committed to serving.
So, what I was trying to say is that if the bank has no policy against such loans, the loan officer should make it as a profitable loan.
However, the bank should have a policy against loans that contribute to any illegal, immoral or any purpose deemed bad for the community. This one should warrant a review by the senior bank officers before approving.
OK, here's my thoughts, albeit I'm late on the discussion thread. Bottom line is you don't have to do anything you don't want to do. There may be consequences to that, like not being the best employee or what not.
Also, I believe Aaron said the decision would be made as the head of the department. In this capacity, I make the loan (assuming Aaron has underwritten it correctly and his due diligence tells me it's risk is acceptable - and as Dave brought up, is not against company policy).
If I'm the loan officer, I pass this one to somebody who wants to work it. I actually did this at my old job. We had a client who is one of the biggest porn stars of all time, and we financed her production company. I was asked to manage the loan in my portfolio. I said I wasn't comfortable with that and I asked that it be assigned to somebody else. It was, and there was no problem, in fact there may have even been more respect for me after that.
Here's a real ethical dilemma. If you own a mutual fund, should you know exactly where the manager is putting your money every day? You could argue that your investment is more of a direct contribution to any given company than an employee of the lender who services a loan to any given company.
If you own an index fund, you probably own shares in companies that you morally disagree with.
If you're wondering where I stand on this, the answer is that almost all my money is in index funds.
Thanks Lance and Dad, interesting comments. I agree with you Lance on the hand-off audible. I also agree with Dad - if it is bad for business (e.g., "Zions banks funds strip club on S Temple") than don't make the loan.
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