Calling the code on business ethics

Back in the mid-1980s, when I was executive editor of the New York Jewish Week, the Jewish world was shaken by two major financial scandals, both involving prominent Jews. One of them was the so-called junk bond king, Michael Milken; the other was the arbitrageur Ivan Boesky.

Keeping the FaithImmediately, “Jewish business ethics” became the butt of jokes, many of which came with quite virulent anti-Semitic overtones attached.

Actually, “jokes” may not be the correct word, because the general feeling “out there” was that Jews had no business ethics.

That gave our publisher, Phil Ritzenberg, a brilliant idea: Why not gather halachic experts in business ethics from all four streams, put them around a table, and spend a morning discussing what Jewish law had to say about how Jews should do business?

The choice for the Orthodox expert was an inspired one. As it happened, the chief economist for the Bank of Israel was at the time on loan to the World Bank in Washington. Dr. Meir Tamari was not a rabbi, but he was both a leading world economist and one of the world’s leading experts on Jewish business law.

The morning of the round table, Tamari was the last to arrive and the first to speak. In preparation for the session, he said, he spent the previous evening studying a list of the 613 commandments said to be found in the Torah. For one particular ritual, he counted five or six commandments; for another one, maybe seven. For yet another one, again, a handful. Then he began to count the number of Torah commandments relating to the ethics of doing business. “When I reached 100,” he said, “I stopped counting.”

The discussion that followed was a truly engaging one, and an edited transcript filled a special eight-page centerfold a couple of weeks later. Nothing, however, that was said over the next several hours made the point as clearly as Tamari did right at the start.

Judaism, indeed, has an advanced code of business ethics that makes anything government regulators have so far come up with pale by comparison – and, as Tamari noted, it all begins with the Torah, which devotes a disproportionate number of mitzvot to how Jews are supposed to do business.

There is no room here for a detailed analysis of that code; the best we can do is provide a mere “taste of a taste” of halacha as it relates to doing business.

One Torah law, in particular, defines the direction halacha takes regarding how God’s “kingdom of priests” must approach its day-to-day business dealings. Here is what the Torah says in Deuteronomy 25:13-16:

“You shall not have … alternate weights, larger and smaller. You shall not have … alternate measures, a larger and a smaller. You must have completely honest weights [eh-ven sh’lemah va-tzedek] and completely honest measures [eifah sh’lemah va’tzedek…. For everyone who does those things [who have unequal weights and measures], everyone who deals dishonestly, is abhorrent to the Lord your God.”

The use of the word “tzedek” for “honest” is very telling. There are words in Hebrew that more directly make the point. The word tzedek, however, has multiple meanings, including righteousness, justice, truth, purity, and sincerity. Using that word in this context demands that all of its permutations apply to the law. Thus, the weight and measure must go beyond strict honesty; they must also be just, equitable, righteous, and kind.

The prophets took this principle very seriously. Thus, Amos states (8:4-10): “Listen to this, you who devour the needy, annihilating the poor of the land, saying, ‘If only the new moon were over, so that we could sell grain; the Sabbath, so that we could offer wheat for sale, using an eifah that is too small, and a shekel that is too big, tilting a dishonest scale, and selling grain refuse as grain! We will buy the poor for silver, the needy for a pair of sandals.’ The Lord swears by the Pride of Jacob: ‘I will never forget any of [your] doings…. I will turn your festivals into mourning and all your songs into dirges; I will put sackcloth on all loins and tonsures on every head. I will make it mourn as for an only child, all of it as on a bitter day.'”

The Sages of Blessed Memory also took this very seriously. Thus, we are told in the Babylonian Talmud tractate Bava Batra 88b: “The punishment for [false] measures is more rigorous than that for [incestuous relationships with] forbidden relatives…. [For incestuous relationships], repentance is possible, but here [in the case of dishonest weights], repentance is not possible.”

A dishonest weight, after all, is theft, and can be atoned for only after restitution has been made. However, someone who uses a dishonest weight is unlikely to be able to name all of those from whom he or she has stolen.

In BT Bava Batra 90b, by the way, the rabbis say that the business activities Amos was quoting God about include a middleman buying produce when the prices are depressed and hoarding it until the prices rise; lending money at usurious rates; reducing the communally set standards of weights and measures; and greedily raising prices on essential goods. (Although prices on non-essential items are allowed to rise on a free market basis, those classified as “life’s essentials” are subject to price controls in a halachic economic system.)

There are other rules that begin in the Torah. Thus, Deuteronomy 19:14 states, “You shall not move your countryman’s landmarks, set up by previous generations.” In BT Shabbat 85a, we are told that this prohibits planting a crop so close to the edge of your neighbor’s land that the roots of your plants could draw away nourishment from your neighbor’s crops.

Put in contemporary terms, before a community can allow four kosher pizza shops to open, or one synagogue near a second one of the same type, a determination needs to be made whether there is enough business for all to succeed – because the prohibition against removing a landmark is actually a ban on unfair competitive practices.

Why are Jewish business ethics often far more stringent than anything governments can propose? Because Judaism maintains that everything comes from God, even wealth. To acquire wealth in ways that are unjust, dishonorable, and unethical is to dishonor God.

As complicated as the halachic business code is, it really is as simple as that.

No one ever taught that to either Michael Milken or Ivan Boesky. Apparently, that lesson is still not being taught.