ETHICS and RISK MANAGEMENT:  Truth, Trust and Honesty

Risk management is like walking a tightrope.  You can play it safe by walking the low rope.  Or you can walk the high rope with more risk of damage but a chance at bigger gains.  Nobody ever said that walking a tightrope, or making decisions, was easy.

Risk is real, and taking risk is a fact of life.  But taking foolish risks is, in a word, senseless.

An awful lot of risk is being sold by an awful lot of ethicists(?) these days.  Some of them, at very prestigious institutes of higher learning, are teaching their students that it’s OK to lie.  And/or cheat.  Don’t believe it?  Check out  An example from an issue of the Harvard Business Review:  “There is no compelling economic reason to tell the truth or keep one’s word”  (note the keyword—economic.  Money is what it’s all about today).  I’m not making this up.  So goes the state of “business ethics” these days.

A lot of money is being made by a lot of unethical people (including “ethics consultants”), but being unethical is courting disaster.  Why take foolish risks when you don’t have to?  Lying, misleading and shading the truth are unethical, not to mention foolish risks.  You can do a lot of positive risk management simply by being honest.  While there still may be risk, you’ll sleep better.

One of the time-tested tools available for anyone’s use is, of all things, truth.  Truth is the basis of ethics and being ethical will never hurt you in the long run.  It can also help immeasurably in the short run.

And not only will honesty and integrity always stand you in good stead in managing risk, it also will pay dividends in your personal  STRESS  management.  Someone once correctly noted that by telling the truth you don’t have to remember what you said, thereby freeing your mind for better things.  Not only that, but you take fear out of the picture—fear of getting caught, fear of punishment.  A free mind is free of stress as well.

Any meaningful relationship is built on trust.  But how can anyone trust someone who lies to him, or worse?  If truth is the benchmark, trust follows.  It’s that simple.  Honesty leads to being ethical, and being ethical goes a long way toward reducing stress and managing risk.

Try it.  You’ll like it.

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