Thursday, September 8, 2011

Business ethics takes a plunge

The state mechanisms are over loaded with the cases of fraud, tax evasion and adulteration as the business ethics has taken a huge plunge lately.
The political transition led instable government and bureaucracy fuelled the unethical business practices exposing not only the common people to threat but also the genuine businessmen and bleeding the government coffer blue.
"In such condition the government machinery must be active," said president of Federation of Nepalese Chambers of Commerce and Industry (FNCCI) — the umbrella organisation of private sector — Suraj Vaidya, who has been lobbying for the good business practice.
Though, it is oblivious that business is done to make profit, the recent raids of businesses and arrests tell different stories.
It is the story of greed to become rich overnight during the transition phase when the law enforcement agencies could not concentrate on law and order situation. Some 'businessmen' are on the money making spree taking the advantage of the current transition.
According to Milton Friedman, business is not bound by any ethics other than abiding by the law. Businesses have the obligation to make a profit within the framework of the legal system nothing more. But the current trend in the country is fearlessness of law and challenging it exposing the people's lives to danger and hurting the business climate of the country.
There is no doubt that the duty of the businessmen is to make as much money as possible, while being responsible to the society. But the greed of profit-maximisation has non-economic concerns like neither can it helps in capital formation not generates employment.
The business bodies like Federation of Nepalese Chambers of Commerce and Industry and Nepal Chambers of Commerce (NCC) must focus on business ethics to protect the genuine business people, otherwise the public perception of businessmen will deteriorate and common people put all the businessmen in one basket saying they are all 'frauds'.
"We are ready to cooperate with the government as the unhealthy practice will hurt the genuine businessmen," Nepal Chambers of Commerce (NCC) president said, adding that there could not be any level playing field, when one businessman is paying tax and the other is not, which will hit the revenue.
Vaidya agreed that the government must punish the guilty not only to protect its revenue but also the genuine entrepreneurs. Last fiscal year, the government failed to meet its revenue target by Rs 16 billion due to its inefficiency in cracking down on such practices.
The government must be strict not only to save the people from being cheated but also to save economy from deviating to informalisation.
If the condition could not be improved, it will be like what chairman of Beed Investment Sujeev Shakya tweeted, “People are getting afraid to look at the mirror after discussions on business ethics have many people with so many skeletons.”

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