Money is a difficult subject for most people to discuss; this is true in personal life, to be sure. Other than with the spouse, one rarely is willing to disclose much about finances. People often are quiet about their giving, although many do allow their names to be used so others can be attracted to the cause. People also tend to talk little about spending, with two exceptions: some people want to make the most out of what they saved, and others want to emphasize how much they spent. In the end, the use of money can be a highly personal matter.
We know more about businesses and organizations and the use of money. With organizations, disclosure definitely is the rule. When supported by donations or tax dollars, charitable and service organizations release information because they’re “OPM”—Other People’s Money—groups. Much of the revenue comes from what others have given, and the organizations have to be accountable. Besides, they often file IRS Form 990, which is available for all to see.
What’s the big secret about the use of money? To some extent, businesses have an accountability trail, too, to shareholders. Even then, most businesses don’t disclose in detail the use of money, because they may have proprietary secrets or want to keep information from competitors. But shareholders want to look at three primary financial figures: overall income, overall cost, and the return on their investment. Of course, family-owned or private businesses don’t have to disclose anything about their use of money. They’re accountable only to themselves—and of course, to the IRS, but on a private basis.
Businesses know that goods and services can be liquid and fungible. Liquidity has to do with payment on a flexible basis. There’s some value that can be translated into money, but that value can be variable. Fungibles can ultimately be transformed into money based on intrinsic value. Another way of looking at this activity is making a good deal. Yet another way to look at this approach: buy low and sell high. This approach is selfish to some extent because the deal revolves around us.
But there’s another aspect to the use of money that moves into the arena of ethics: is money being put to good use? This ethical approach was popularized by John Stuart Mill, the 19th century economic philosopher who developed utilitarianism. His view: we need to try to make the best choice for the most people. Another way of looking at this philosophy: everyone can win. The giver and the receiver benefit through a purchase or a gift. Everyone receives value.
But what happens in the misuse of money? After all, it happens all the time. If the best and most ethical use of money is value and benefit to all, then the misuse of money is selfishness. In selfishness, there’s the basic desire to control money, whether it’s one’s own or what belongs to someone else. But the misuse of money becomes difficult when a person tries to manipulate it so he not only has control of it, but tries to get as much of it as possible. The worst misuse of money is fraud, when a person uses underhanded methods to cheat people out of money and get as much as possible. There’s a saying, “He who dies with the most toys wins.” Just substitute money for toys, and the same unethical use of money happens.
In the Bible, Jesus says that people can’t serve God and Mammon. Mammon is like a god, gaining control of people’s hearts and minds and encouraging selfishness. That’s an unethical lifestyle. We don’t necessarily need to be followers of Jesus or believers in God to affirm that the best and most ethical use of money is to create a way for everyone to benefit from its use.
For individuals and families, that can be a challenge. We have our own goals and objectives, and we want to try to gain the most we can out of money. Ethically, we need to try a better and more open way. And it’s simply good business—as well as great ethics—for those who offer goods and services to others to create ways for everyone to win, and to move from customer to partner in commercial life. IBI
