A Jewish Business Strategy

by Dr. Meir Tamari

No legal framework, whether divinely inspired or humanly crafted, can of its own effectively create a moral and ethical marketplace. At best it limits fraud, exploitation and dishonesty, at worst it provides a fig leaf for widespread business immorality. The framework requires a spiritual, cultural or religious consensus that educates and indoctrinates towards the distinction between right and wrong, and provides guidance for fulfilling ethical goals. So apart from its legal parameters of what is forbidden, Judaism also provides moral milestones for what one should be doing in the market place and for the public consensus regarding economic activity. Thus, a Jewish business strategy is provided for the modern, complex and sophisticated financial, commercial and professional markets.

“You shall love your brother as yourself.” (Lev. 19:18)

Rabbi Yosay’s saving, “Let your fellow’s money and property be as precious to you as is your own” (Avot 2:12) requires consideration for the welfare of all the other parties to a transaction. This is manifested in full disclosure not only of defects but also of potential difficulties and prospects. The sharing of information regarding prices, the availability of services or goods and the market trends are market expressions of loving your neighbor.

“You shall: surely return it to him.” (Deut. 22:1-3)

The biblical injunction to return lost articles to their owner, is understood by the Talmud to obligate us also to prevent damage to another’s property caused by a third party. In the modern economies information in all its forms is a major economic asset. So information regarding hostile takeovers or third party conniving and our own experience with shoddy workmanship, unprofessional behavior and inferior performance, needs to be transmitted to the potentially affected party.

“You shall surely open your hand.” (Deut. 14:8)

It is a positive mitzvah to use some of our G-d given wealth to alleviate the poverty and physical suffering of others. This requires not only participation in the communal social costs but also personal philanthropy. Jewish charity extends also to the non-Jewish poor, and to protecting the property even of those who are not poor.

“You shall surely help together with him” (Ex. 22:5)

Alleviating another’s economic problems, through business advice, interest free loans, and the offering of a job or joint venture is the highest form of Jewish charity. Since the biblical verse refers to assistance to one’s enemy, this goes far beyond the economic field, being a healing of social tension and conflict. Rabbi h. I. HaCohen Kook saw the shmittah (Sabbatical Year) as the spiritual cleansing of individual and communal economic immorality just as the Shabbat enobles the mundane affairs of the weekdays.

“When you shall finish to tithe.” (Deut. 26:13)

Today, when the communal ability to tax us to fund Jewish charitable needs is weak or non-existent, the obligation to tithe our income for that purpose, has become more imperative than ever. Our sages saw 10 percent as a minimum tithe and 20 percent as the maximum in the case of the average person. All income, irrespective of its source-wages, interest, dividends, inheritance, capital gains, profits-need to be included in the income base. This after taxes and the cost of earning the income but before insurance premiums, obligatory pension or social payments. The tithe money may only be used for religious, social or charitable purposes that are not obligatory for example this would not include membership fees in a synagogue.

“And the Levite and the stranger and the orphans and the widows shall eat.” (Deut. 14:28-29)

The gleaning, tithing, unharvested corners, enjoined on our forefathers as farmers obligate us to perform similar acts of kindness and mercy in our regular business and economic activities. All the people mentioned in the above verse are the weak, defenseless and the marginal ones of society. So, too, are the inefficient, less capable and less educated parties to our business transactions. We are required therefore to forego some of our legal rights when dealing with them whether they are our debtors, or our competitors.

“And you shall do that which is good and honest.” (Deut. 6:18)

Growth, profits and efficient markets are necessary to all economies whether that of the individual or that of a country. However. we are obligated to add another dimension to create a specific Jewish business strategy. The avoidance of fraud, misrepresentation or dishonesty is not sufficient in this strategy. Lifnim mishurat Hadin requires behavior wherein legally recognized rights are sometimes waived. Sometimes we need to allow our competition to also have a share of the market. Sometimes investments or products may have to be avoided even when they are legal, since they damage the environment, affect people’s health or exploit ignorance and weakness. An employment policy is required whereby every effort is made to retrain redundant workers, provide them with the counseling needed for a transition period and perhaps even prevent their redundancy through work sharing or agreed upon wage cuts.

“When you lend money to your fellow.” (Ex. 22:24)

There is an obligation to make interest free loans both to the poor and to the rich in cases of temporary insolvency. These loans prevent people becoming poor, assist the unemployed to start their own businesses and enable the poor to break the poverty cycle.

“You shall have just weights and measures.” (Lev. 19:25-26)

Almost all white collar crime is conducted in secrecy. The rabbis understood the textual linkage of just weights to the presence of God to underscore that in fact there is no such secrecy. The acknowledgment of an all seeing and all knowing God is Judaism’s major factor in achieving a just and moral marketplace.

“You should go in good ways and follow the path of the righteous.” (Proverbs 2:20)

“A community had hired a shochet for long term employment and his wages were to be paid per head of cattle slaughtered Now the abattoirs have to be transferred to another city. The shochet claims that they should continue to pay him. According to the law they are not liable to pay. In the absence of a contract, however, it is fitting and correct that they should deal with him beyond the letter of the law, since he is poor and his children depend on him.” (Pitchei Teshuvah, Choshen Mishpat, Section 333 Subsec. 3).

“Reuven has been selling goods for thirty years and has many dependents. Now Shimon who is wealthy and has other businesses but no dependents, wishes to open a similar firm. in this case, the law is that Reuven cannot prevent him. However, according to the Bach (Rabbi Joel Sirkis), Shimon’s competition is an act of Sodom which can be prevented by the courts. Even those authorities who maintain that this is not so, hold that the court should at least use verbal pressure to persuade him not to open the competing store” (Tzemach Tzedek, Choshen Mishpat, sec 23).
Dr. Tamari is the former chief economist of the Office of the Governor at the Bank of Israel, and the founder of the JCT Center for Business Ethics and Social Responsibility.