Is unethical trading going to rip the guts out of industry?

2010 is around the corner and that’s proving to be a quite a relief for many, at least on a psychological level. But, of course, we are not out of the woods yet.

For years arguments about ethical trading have been predicated on the need to look beyond pure economic objectives when doing business. Right now, this argument just does not hold weight as companies fight to survive, and in some cases stretch relationships beyond goodwill and reasonableness.

Many businesses have been propped up by banks during the past year so that they can carry on trading in the fight for survival. But has this resulted in an inherent risk within the industry resulting from a lack of moral principle in relation to the payment for goods and services?

Just what does constitute survival in this market? For some, it is the hope of continued financial support next year, and for others it is the resignation that the fight may be over and the next best thing is safeguarding jobs for the hope of the right buyer.

But reality is about to bite as banks remove their support and expectations on struggling businesses increase in terms of their capacity to resolve their respective problems. And this means there are companies continuing to trade in the full knowledge that they will go bust in early 2010, and who might be setting themselves up for a pre-pack administration. While it’s a tough call for many to decide exactly what to do in such circumstances - what is truly reasonable, given the possible consequences?

So what will become of the suppliers who have continued to supply goods and services, but are now owed thousands of pounds? Cash resources have been depleted in even the most prudent of companies, and in many cases these suppliers are established, credible businesses who have been caught up in an impossible equation.

Yes, it is a bloody climate, but the ethical dilemma appears to have been lost for some and this does not necessarily make the industry better as a result.

Do you have any comments on this topic? We would like to hear your views.
Please email: stinginthetail@epmagazine.co.uk