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8/04/2009

In Praise of Human Decency

Great Eastern has done a coup of sort to offer a big payout when it does not need to. In fact the precedent has been set for it to play by the market practice and save a lot of money, except for the pain and loss the investors will continue to bear. One question is whether Great Eastern has crossed the line to the extent of undermining the correct business practice and the rule of law here that we are so proud of, and chose to invest in a bit of morality, ethics and human decency, which are only good for the souls but not for the bottom line. It was a rare moment indeed in a country that crows about making money at all cost, where scoundrels are praised and held in high esteem, and not how the money was made, where making money is the end all, with no qualms about human decency. Investors have been complaining that they were questioned by high and mighty officers of financial institutions demanding only to know if they understood English, and if they had signed on the documents. If either was a yes, no further explanation was needed, and out of the door they went, with minimal or no compensation. Legally right, legally binding but morally shameful. Technically and legally, the financial institutions are right by applying the rule of law. That could be the reason why they were so arrogant that they were doing the right thing. It's all legal. The investors understood and signed the documents. These were enough not to compensate them fully or at all. Caveat emptor man! Just as much we need to protect the investors, the financial institutions also need to be protected under the rule of law. So which should overrule the other, the rule of law or morals and ethics? I think when in court the rule of law will be upheld and not any wishy washy stuff like morality, ethics or empathy. We cannot undermine our system of correct business practice, our rule of law, and compromise on such rulings. The peddlers of snake oil also need to be protected under the rule of law. My view is that Great Eastern must have come to the conclusion that the product must be flawed and morally not right to make this kind of money from the their customers. They have set aside all legal and technical arguments in their favour and chose to make a human decision to return the money to their clients. The decision of Great Eastern speaks a lot about the quality of their leadership. Something we find very lacking in this materialistic world and something we only heard in motherhood statements but not in practice.

5 comments:

Wally Buffet said...

This $250 million "coup" in my opinion, is a desperate measure to salvage the dead life insurance market in Singapore and this company's raison d'ĂȘtre is life insurance. No one is buying any more life insurance products. Life insurance agents are becoming extinct or they have morphed into property agents. I dunno about the "human decency" part but it sure make sense to splurge some money to redeem the bad image of investing in something that you will only see a few tens of years down the road and by which time, you may need to pay 1000 singgit for a banana! Like I said earlier, people prefer to put their money now in condos to await the expected flood of PRCs coming our way. It is an asset you can see, live in or rent out rather than receiving a piece of glorified IOU with a promise to pay something in the future or when one kicks the bucket. Laggard investments are no longer in favour. Returns must be "fast and furious". We are into casino culture now remember?

Anonymous said...

Redbean:

You said it !

Great Eastern has done a DECENT job.

Moral and conscience do prevail.

patriot

Jaunty Jabber said...

Dunno why, I just feel that it is not entirely decent but a strategy. The company can treat it as a marketing budget to promote the company's brand name, it definitely stands out when people compare them with their competitors. Long run, pulls in more customers.

Anonymous said...

JJ:

So long as customers are well and fairly treated, let it be marketing strategy or publicity.

Satisfying customers should be the first principle in business.

And

Making citizens happy must be the first priority of any government. Simple conventional wisdom.

patriot

Anonymous said...

Everybody thinks that the only decent way of doing things is his way.