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March 01, 2011 at 07:00 PM
As financial advisors, we sometimes find ourselves in conflict. For example, when buying investments on behalf of a client, we may find ourselves conflicted between serving the client’s best interest on the one hand, and obtaining the largest commission on the other.
The financial advisor profession is not the only one with common and inherent conflicts of interest; the legal profession has a serious case too.
The client’s interest is to settle a case as quickly, inexpensively and quietly as possible, whereas the lawyer’s interest is to drag it into court for a protracted battle.
Even the medical profession is not immune, although perhaps a little further removed. In HMOs, it is the medical staff who (hopefully) wish to do right by the patient, and yet the business administration staff (who pay doctors their salaries) are perhaps more concerned with cost savings, at times against better medical judgment.
I have given much thought lately as to how such noble professions could be set up in a way with these innate conflicts of interest constantly lurking below the surface. My conclusion is that they were not set up this way and the conflicts of interest that we see today are the effects of a relatively recent shift in our drive, purpose, values and outlook as professionals.
Let me illustrate my point with a true and poignant anecdote. In the early 1930s my father, after graduating high school, was travelling from South Africa to England to study. A very good boyhood friend of his was travelling with him on the same ship. This friend, however, was not yet sure as to what he wanted to study and what career he wished to pursue. He was oscillating between two possibilities — either a rabbi or a doctor. When I first heard about his quandary, it seemed quite absurd to me. Those two vocations appeared to be so diametrically opposed and in my mind, could be compared to somebody questioning whether to become an astronaut or a farmer!
When I thought about it more carefully, it made perfect sense. In those days, you see, a person became a doctor because he was driven to help others. His mission and purpose was to heal people. Making a living was secondary to this sense of higher purpose. A doctor’s mission was not that far from a rabbi’s — both were to help others, one physically and the other spiritually.
