The Golden Rule: Trust, Commitment, Communication

by Edward Henkler on January 20, 2015

The 14-Jan-15 Inquirer included an article about immigrant businesses which reminded me of a key difference between people and organizational entities (businesses, academic institutions, etc). There is a much higher level of trust and commitment between two people than ever exists between an individual and an organizational entity. Behavior also tends to be markedly better between two individuals rather than someone “hiding” behind an organization. We do and say things behind the anonymity of an entity that we wouldn’t consider person-to-person. This same phenomenon seems to occur on social media where the interaction may be one-on-one but the virtual connection seems to reduce/remove the filter most of us have when we communicate. I’m referring to the filter which helps us consider the other person’s feelings and perspective when we interact. Remember the Golden Rule?

Returning to the article….what caught my eye was the concept of a “lending circle”. The traditional solution when you want to buy a car, home, or even start a business is to reach out to your local bank or credit union. Many people see banks as necessary evils and don’t feel too much guilt when they have to default on a loan. A recent trend with millennials is to reach out to crowdfunding resources such as Kickstarter. This approach can be even more impersonal and I suspect there’s a significant percentage of the projects which never progress. “Lending circles” are an approach which relies on “family honor as collateral”. The “lending circle” provides pooled-risk loans from friends, peers, and family. My guess is the default rate is much lower than with traditional loans and I also suspect that the “lending circle” feels much more engaged in ensuring the success of the venture.

The fallacy is the belief that no one is hurt when you breach commitments with an organizational entity. Fraud punishes everyone who is connected to the entity with higher costs and more cumbersome safeguards. Much would improve if we always interacted with a high level of trust, commitment, and decorum. Perhaps the Golden Rule should be, “One should treat every individual and organizational entity as one would like to be treated.”

New Golden Rule

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