Hack:
Agreement - Virtue - Endurance - Reality: (AVER) Imperative

By John Roth

September 30, 2016 at 1:01pm

Long Term

sustainability

responsibility

Resilience

Moonshots

Embed the ethos of community and citizenship

Redefine the work of leadership

Stretch management timeframes and perspectives

Summary

Repeated instances of corporate and institutional neglect should evoke better attentiveness toward a reconsideration of authentic responsibility. With respect to long‐standing historical acceptance, an appreciation for the traditional four cardinal virtues should be freshly reconsidered as well. But this is not as direct and simple as it may seem.

Problem

Anyone in the business community is probably familiar with the claim that open markets will find their own best balance through the operation of an “invisible hand.” Economic supply and demand tend to find a natural equilibrium, free from intervention and constraint.

The concept of the “invisible hand” was first proposed by the economist, Adam Smith, in The Wealth of Nations in the eighteenth century. It is not commonly remembered, however, that the same Adam Smith published another book on A Theory of Moral Sentiments. Here he expounded the belief that a strong social acceptance of traditional virtues was a condition for providing the atmosphere of mutual trust necessary for the conduct of commercial enterprise. If that belief has been disregarded, a particularly emphatic quotation comes from the congressional testimony of the former Federal Reserve Chairman, Alan Greenspan, in October of 2008: “’Those of us who have looked to the self‐interest of lending institutions to protect shareholder’s equity . . . are in a state of shocked disbelief,’ he said. This failure of self‐interest to provide self‐regulation was, he said, ‘a flaw in the model that I perceived as the critical functioning structure that defines how the world works.’“

It may be concluded that a broad deterioration in society’s traditional ethical standards contributed substantially to severe economic problems, recently during the past decade, yet a true means to retrieve recognition of proper virtues and ethics has yet to come into focus.

Hyperlink: John Bogle – Enough (period) – 2010

Dominic Barton has previously raised similar issues on Management Innovation eXchange in relation to the Long-Term Capitalism Challenge in 2012. 1) Believe in your power to make markets efficient — but abandon the efficient market dogma . 2) Believe in the real game — long-term value creation — and stop acting as if you are meeting your highest calling if you simply play by the rules. Action must become extended beyond belief.

Hyperlink: Dominic Barton – The Power of Beliefs to Move Markets and Mindsets –2012

Solution

Personal and institutional values can be responsibly restated and kept refreshed, with respect to well-know and time-honored understandings – unfortunately eclipsed with normative patterns and behaviors.

Hyperlink: John G. Taft – A Force for Good – 2015

Practical Impact

Prudence:

* A comprehensive social awareness must accompany authentic leadership.

* Substantial equity investment in a corporate business organization should imply active

participation in decision and direction.

* Extremely large and influential institutional entities are in a position to have a positive and

powerful impact.

Broad and thorough consequences of financial decisions must be fully considered.

Justice:

* Reliable and predictable public financial interactions must also depend on an encompassing

appreciation for societal well‐being and interdependency.

* A sentiment for fiduciary duty and an acceptance of stewardship are essential realizations

for restoring integrity and trust –

where the best possible arrangements on behalf of clients must have first priority.

* All of the various participants along a full spectrum of involvement with financial transactions

and financial holdings must conduct business arrangements with openness and clarity.

Fortitude:

* Governmental reactions following after the recent financial crisis have not yet fully confronted

less formalized aspects of the financial marketplace.

In some respects, rulemaking will always be insufficient without dedication to shared

principles.

* Established governmental entitlement programs, mortgage financing programs,

and retirement programs will increasingly require urgent attention and readjustment.

* Exceptional fiscal and monetary interventions by central banks have borne undesirable

side effects, and an imperative to restore normalcy is needed.

Temperance:

* Excessive financial speculation should be vigorously avoided and discouraged.

* Specific prevalent practices, such as periodic frequent earnings announcement,

have contributed toward a distortion leading away from purpose and vision.

* Overemphasis on short‐term expediency is a distraction away from better long‐term

endurance and regeneration.

Challenges

Is it useful to try to move away from seemingly proprietary and individually asserted frameworks and conceptual structures, and to move toward more universal or open ways of confronting these kinds of challenges?

Attitudes and beliefs and mindsets become implicated, so how can matters be addressed on this necessary level?

Are there specific firms or forums or individuals ‐‐ outside from academic centers ‐‐ that are successfully working on building and promoting practical solutions along these directions? (Are they approachable?)

What are the best things that could happen next, in pursuing better awareness about comprehensive long‐term visions and solutions, in ways that really matter and can really make a difference?

First Steps

One standing source of inspiration may be found in the work of Josef Pieper, who was already an accomplished young author in Germany during the earlier part of the Twentieth Century, before his works were condemned and confiscated by the Nazi Regime. Stationed with the military during World War II, he returned to writing and teaching as a professor at a German University after the defeat of the Third Reich and the restoration of peace. His experience would enforce a depth of commitment and conviction. And, his explanations about The Four Cardinal Virtues appeared in English over fifty years ago. These concerns would precede and pre‐configure the more current trends in Virtue Ethics and Positive Psychology.

Prudence: The meaning of the virtue of prudence, however, is primarily this: that not only the end of human action but also the means for its realization shall be in keeping with the truth of real things. This in turn necessitates that the egocentric "interests" of man be silenced in order that he may perceive the truth of real things, and so that reality itself may guide him to the proper means for realizing his goal. (4V P. 20)

Justice: To be just means to recognize the other as other; it means to give acknowledgment even where one cannot love. Justice says: That is another person, who is other than I, and who nevertheless has his own peculiar due. A just man is just, therefore, because he sanctions another person in his very separateness and helps him to receive his due. (4V PP. 54‐5)

Fortitude: Pericles, in the lofty words of his speech for the fallen heroes, expressed . . . "For this too is our way: to dare most liberally where we have reflected best. With others, only ignorance begets fortitude; and reflection but begets hesitation." – Pericles, as cited by Thucydides, Peloponnesian War, Book II – (4V P. 124)

Temperance: It is always the decisive center of the whole, indivisible person by which the inner order is upheld or upset. (4V PP. 148‐9)

The Four Cardinal Virtues (4V) is apparently now in the public domain, and the full text is freely and openly available through archival Internet sources.

Materials

Hyperlink -- John G. Taft

Hyperlink -- Generation Foundation

Hyperlink -- Capital Institute

Hyperlink -- Focusing Capital on the Long Term

Hyperlink: -- Atlantic: American Prosperity Project

New Hyperlink: -- 2018 New Biography: Adam Smith - Father of Economics

Documents

JBogle_Enough2_090610.pdf

AgreementsVirtuesRealities2_070316.pdf

AVER_Imperative1_100116.pdf

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September 29, 2018 at 2:11pm

John Roth

This contribution was added almost two years ago. Just this week the approval markers exceeded 1000. My gratitude to the MIX community. I may be overdue to set up a new item. Thank you -- JR

February 16, 2017 at 3:01pm

John Roth

Again I always appreciate the encouragement of the MIX community in recognizing these efforts. It is great to see how the AVER contribution gathered over 500 approval indications in just about four months. Otherwise the ADEPT contribution (Design Thinking and Innovation) has now received over 1000 approval indications, as well as over 1000 approval indications for the MAZE contribution (Psychological Grounding and Enterprise Transformation) and over 1000 approval indications for the PROOF contribution (Background concerning Deliberate Decision Management.) Consistently, the cover text provides some discussion regarding the more thorough long-form PDF content made accessible through the hyperlinks. Thank you -- JR

February 9, 2017 at 1:03pm

Jim McGriff, Jr.

The modern separation of ownership from the individual removes the moral one step to a board. This board is also removed from the business operation because of the political motivations of the members and their lack of actual knowledge of the business operation. The cardinal virtues related to individual character is therefore diluted by political motivations. These members have no life stake in the business success. The main problem for them is if the business fails is to find a new board to sit on. Also, the ownership stake in the business is diluted over the number of stockholders. These stockholders are at the mercy of the board and chief executive and have little say in the actual operation of the corporation. Adam was discussing a time entirely different from our world. A world without large corporations.

October 2, 2016 at 7:48am

John Roth

Again this contribution is in keeping with the concept of three Relational Integration Prisms -- RIPs -- as described also in the previous ADEPT Exploration. Here the emphasis would be about the Motivation RIP--. . .

For my own purposes, I have been maintaining three Relational Integration Prisms -- RIPs -- in trying to situate what I do in view of larger circumstances. A Comprehension RIP would describe subtle, interpersonal interactions. A Progression RIP would distinguish effective collaboration factors. A Motivation RIP would recognize aspects of traditional values and virtues, applied in practice. jR