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Friday, April 12, 2024

We need ‘honorable merchants!’

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IN a world where short-term gain seems to be more attractive than long-term sustainability, in a business environment where a business deal needs endless pages of legal language that can easily be circumnavigated if anybody wanted to, it may be necessary to focus attention on the historic principle of the “honorable merchant” and “preserve the virtues and decency” of the honorable merchant.

The term honorable merchant describes the mission statement for responsible stakeholders in economic life. It stands for a sense of responsibility for one’s own company, for society, and the environment. An honorable merchant bases his/her behavior on virtues, which aim for a long-term economic success without opposing society’s interests. This concludes sustainable business.

But what makes a merchant honorable? The roots of the principle can be traced back to the early middle-ages. A merchant could call himself “honorable” and benefit from this reputation if he acted in compliance with the developed rules. He became honorable through virtues such as integrity, honesty and decency. The honorable merchant stood out because he always kept his word and others could rely on him. The merchant’s reputation was intertwined with his commercial success, and therefore represented a crucial asset for his business.

Nowadays, the notion of the honorable merchant appears rather old-fashioned, but numerous development trends in society, politics and business illustrate that decency also plays a major role in the 21st century.

Globalization increases the competitive pressure as counties and companies with a different understanding of integrity compete; the same is true for Asean integration where competition will increase and good companies and not-so-good companies will clash. Luckily, the public gets more and more critical and social media raises the bar. People have very high expectations when it comes to assumptions of responsibility and respectability regarding companies. In the financial market, the demand for sustainable investment increases continuously. Some funds only invest in companies that fulfil, besides economic, also social and environmental criteria.

In the middle-ages, the merchants proved that the collective establishment and implementation of the principle of the honorable merchant could generate benefits for both companies and society. Globalization and the resulting loss of influence of governmental control mechanisms, puts more pressure on companies and their management (executive and supervisory) to create preconditions that enable sustainable and successful business activity.

The honorable merchant as a person:

has a tolerant and liberal attitude,

keeps his/her word with the handshake as a binding act, and

develops commercial judgment capabilities.

The honorable merchant in his/her company:

acts as a role model through all actions,

promotes honorable behavior in the business, and

aims at long-term and sustainable business objectives.

The honorable merchant in society and the economy:

heeds the principle of equity and good faith,

recognizes and takes responsibility for the economic and social order, and

always advocates values both in domestic and foreign trade.

The honorable merchant became the guiding star when the Integrity Initiative in 2009, joining hands with the Makati Business Club in 2010, and organizing the Integrity Initiative Inc. in 2015. We are committed to ethical business. We are calling on people in business, government and civil society to join us.

Feedback is more than welcome; contact me at hjschumacher59@gmail.com

Read full article on BusinessMirror

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