Further to our last post, if the police are looking for better ways to spend the money they are currently spending on meaningless slogans, we have a suggestion.

It was fascinating to note how police were called to a circus in Belarus which defrauded its customers. Advertising promised a show that included black bears, monkeys, crocodiles – note the plural – and “orcs”. What the customers got was a poor display of poodles, a crocodile – singular – and drunk jugglers who kept dropping their props.

It could be argued that the customers had no right to expect that the advertisement was literally accurate – after all, it ought to be a clue when orcs are promised: they do not exist outside the pages of J R R Tolkien. Yet there is a serious question here: at what point does failure to provide what was contracted become fraud?

The rule of thumb must be that breach of contract is fraud when it is clear that one of the parties never had any serious intention of honouring the contract. In practice, this is very difficult to prove – especially since, in most cases, the courts are involved only long after the event.

In most jurisdictions, breach of contract, even where it is almost certainly deliberate, is a civil matter. Proving it might involve a great deal of litigation. By the time it is established, the wronged party’s chances of obtaining full compensation are fairly remote. Con men know how to keep moving.

The involvement of the police at an early stage would therefore be very helpful in many cases. This does not mean carting people off to jail as soon as a complaint is made. The police should be very cautious – perhaps more cautious than they are at present – when it comes to slapping on the handcuffs.

All that is suggested here is that the police should be asking questions more often. The fact that they may have to justify their business practices to the police might keep some people honest. Also, having police statements as evidence would help civil court judges sort genuine victims from the merely litigious. A pattern of complaints would enable the police to identify those who require more detailed investigation.

Some businesses might object to the prospect of greater contact with the police. In police states or where the police are corrupt – often the same thing – more police intrusion is the last thing business wants! Yet, contrary to media stereotype, most businessmen are instinctively law-abiding, and businesses are more likely to be victims of crime than perpetrators. Despite that, and despite the taxes we pay, we usually get a poor service from law enforcement. Shoplifting, vandalism, and criminal trespass are rarely taken seriously by the authorities. In most places, we have a right to demand better value for money from our investment in public protection.

You would imagine a survey of “ethical violations” in fictional portrayals of business on television would have a lot of raw material. From the evil deeds of JR Ewing in Dallas to the compulsive roguery of George Bluth in Arrested Development, scriptwriters find it annoyingly convenient to equate the businessman with the crook.

Yet an organisation going by the rather Orwellian name of Global Compliance has missed the point. It describes breaches of its own notions of “diversity”, “equal opportunity”, and “process and policy integrity” as ethical violations. Ironically, the show that offends most against these peculiarly leftist ideas of ethics, the brilliant 30 Rock, is fronted by two actors, Alec Baldwin and Tina Fey, with impeccable leftist credentials.

Global Compliance must be a joyless place to work. A dynamic organisation should encourage, within broad limits, the free expression of ideas. Workplace banter is a sign of organisational strength, even – no, especially – when it is challenging or passionate. It should be part of a broader corporate culture of flexibility and openness.

Such a culture is itself ethical. Yes, ethics matter – but real ethics, not the pseudo-ethics of a Global Compliance. At this time of New Year’s Resolutions, here are the principles that should be monitored: -

1.   Truth. The business world is an increasingly small place and reputation is easily lost. It may be possible to get away with lies for a little while, but not for long, and then a business career is finished for good. It is therefore good policy to be careful to speak only the truth, and certainly never be caught telling lies.

2.   Financial Probity. Again, it might be tempting to fiddle a little cash here and there, but a reputation for scrupulous honesty with money is far better for business in the longer term. You might listen politely to someone boasting of over-claiming on expenses, but you would make a mental note never to employ him.

3.   Loyalty. Go out of your way to look after your customers, your employees, and your suppliers, and they are more likely to go out of their way for you.

4.   Courtesy. This is not the same as the notion of “respect” being pushed by the likes of Global Compliance. Old fashioned good manners were designed to make people comfortable in social situations, but the “political correctness” of Global Compliance makes everyone uncomfortable. Lead by good example, not fear.

This is a good time of year to reflect on charitable giving. Contrary to the stereotype of the hard hearted capitalist, most businesses and businessmen like to “put something back”. The huge donations of the wealthy, the Gates and the Buffetts, are well publicised, but rare is the entrepreneur who has never put his hand in his pocket for someone worse off than himself.

America’s philanthropic tradition is more developed than Europe’s. Research shows that this is due to America’s religious culture, but even irreligious Americans, like Gates and Buffett, are more likely to see charity as a duty.

There is another difference between American and European, or British, thinking. Toby Ord, a British researcher on a fixed income, has pledged himself to give a million pounds to charity over his lifetime by living frugally.

Commendable, certainly, but an American would probably do things differently. Given the task of giving a million to charity, an American would probably identify Ord’s fixed salary as the real problem. Instead of working for someone else for a pittance, an American Ord would set up his own business. If things went reasonably well, the business might yield a few million in the course of a decade, sufficient for the million– and more – to charity, with enough left over for a comfortable lifestyle.

This way of doing things has two advantages, in addition to the probability of a greater yield for charity. First, it adds value to the economy, while living off a fixed salary subsidised by the taxpayer does not. Second, a reasonably comfortable lifestyle – so long as it is not excessively self-indulgent – is more likely to increase your productivity than grim frugality. Even saints are motivated by the prospect of reward.

Of course, all this misses the point. Most of us do not set ourselves the arbitrary objective of donating a specific sum. Charity is about giving according to one’s means, whether it be the widow’s mite or the loudly trumpeted benefactions of a Gates or a Buffett. The poor are always with us and we can do good to them whenever we want.

Charity – from the Greek word for “love” – is not just a matter of giving from our surplus income. It is about how we treat people generally. It is the complete opposite of charity to behave unscrupulously in business and then hope that a large public donation to a good cause out of ill-gotten gains will put everything right. Honesty and decency – and sometimes, when the opportunity is given, a little compassion – in our everyday business and personal lives would do more good than a million to charity.

As we get older, we have to make a positive effort not to turn into the bore who is always complaining how much better everything used to be.

Such complaints are unwise not only because they are tedious but because they are usually wrong – most things are much better than they used to be.

That said, it can’t be denied that progress in some areas has been accompanied by deterioration in others. In particular, we may be wealthier in financial terms, but is that at the expense of something more important?

In over a quarter of a century in business, this contributor has seen a definite decline in honesty in the daily transactions of commercial life. Where we could usually proceed on the assumption that most people would make an effort to keep their word, and be fair and reasonable in their dealings, it is now almost expected that big organisations in particular will try to chisel and evade their obligations.

Of course, there have always been chancers, but the worst offenders are now the pillars of the Establishment on whose reliability the whole economy depends: insurance companies, banks, pension funds, even government.

It is increasingly rare for insurance companies to pay promptly, and in full, money to which the premium payer assumed he was entitled. Insurers claim that this is, at least in part, because they are themselves increasingly victims of fraud – which is, of course, true – but we are entitled to ask if the chicken came before the egg in that sector?

The same is true of banks. They may claim to be the victims of bad loans, but they made those loans. There would have been no 2008 crash if bank managers were still reactionary but scrupulously honest old fogeys – think George Mainwaring in the British comedy Dad’s Army – instead of City wide boys looking no further than their annual bonus.

Yet government is the worst offender – because those at the top set the example for everyone else. Public service – once considered honourable because it was underpaid – is now a cash cow, and bureaucrats regularly misuse laws passed for legitimate purposes in order to raise revenues.

Public office is now an office of profit, as it was in the 18^th Century. So far from progressing, we seem to have regressed to the time of Oliver Goldsmith: “Ill fares the land, to hastening ills a prey, where wealth accumulates, and men decay.”