Financial Literacy has never been more timely: Talk about it

Preface: Stumbled across this posting in the archives: It was originally published in September of 2008 as a commentary on then-current affairs, and we still have a ways to go with what’s discussed here. I have not edited it in this republishing for the fun of the 2008-2011 comparison; I just checked on the viability of the links.

Click on this illustration by Tom Bachtell for A Walk in the Park by Hendrik Hertzberg at The New Yorker

Financial literacy is, and has always been a hot topic in the ‘Ohana in Business discussions we have, and it’s one of those hot times to ramp up our on-the-job conversations about it.


Financial Literacy Has Never Been More Timely

Have a meeting coming up and need to fill a hole in the agenda?

Bored with the normal fluff around the water cooler or when escaping to the coffee place down the street?

Thinking about turning the television off tonight in favor of some meaty discussions around the dinner table?

Bring up financial literacy in all its timely, hitting-your-pocket relevance. From Wall Street to fuel prices, from tax relief plans by presidential candidates to your 401k risk assessment, and in thinking about how many readily available greenbacks to have in your mattress over the coming winter, broaching the subject is easy.

I’m hoping you’re talking about it and not just watching from the sidelines, because if there is one bright side to the mess of our U.S. economy right now it is this: There is a ton of learning to be had. To not take advantage of this grand classroom now called Life in the U.S.A. wherever you may live and be in business is a lost opportunity.

Just read this, following an Anderson Cooper tweet-feed in Twitter:

Commentary: Blame boards of directors for financial mess

‘Blame’ is one of those words which grates on me, and in fact, I responded on Twitter,

@andersoncooper “blame” such a futile word. Perhaps “learn from” or even, “seek to be better than” those who have erred so dangerously.

However I largely agree with these assertions by author Nell Minnow:

“Failure this broad and deep takes a village, and regulators, lawyers, compensation consultants, auditors, executives, shareholders, and the press all played a part. But the people who are most responsible for the massive meltdowns of these institutions are the boards of directors.”

“Their sole responsibility is to act as fiduciaries for the shareholders in managing risk. They not only failed to perform this task but indeed, in their approval of outrageous pay plans with perverse incentives, they all but guaranteed the current disaster.”

“I am a capitalist. I love it when executives earn boatloads of money. But it infuriates me when they get it without earning it.”

Redflags

Tiananmen on Flickr by ciro@tokyo

Let’s take it further:

Why shouldn’t scores more people be taking some small degree of responsibility with this?

It is my belief that a business model of any kind is healthiest when every single person who is a stakeholder in that business understands how that model works, and thus, when it doesn’t work. A business is healthier when red flags are at the ready in everyone’s pocket, and by the time they make it half-mast there is collaborative responsiveness as people work together to get those green flags up instead. Alternatives and solutions begin to take root everywhere as the seeds of new ideas and evolutionary innovation get sown. Business models —even ones that are working just fine, should not be fixed or stagnant; that’s called mediocrity, and resting on your laurels. Both are unacceptable.

In my career, I had learned the hard way that assuming the “guys in the office” or “people who get paid the big bucks” know what they are doing is a very dangerous assumption (Read more at Blind Faith is not part of Unconditional Aloha in an ‘Ohana in Business). They might, but why shouldn’t you know too, whatever your role in an organization?

Why shouldn’t you be more inquisitive, know how all the work that you and others do is connected, and how ultimately it keeps a business thriving in the most profitably healthy way?

There are far too many organizations where people don’t speak up often enough because they feel they cannot intelligently carry their part of the conversation. I HATE seeing that in play in workplace cultures, and it is my stance that managers are the ones responsible for introducing these conversations, and facilitating them. Great managers introduce the meaty topics of financial literacy consistently as practice, and they hand out those red flags they want at-the-ready in everyone’s pocket.

Business takes a whole village, and a highly conversational one. If you are not now having the conversations conducive to continually ramping up the level of financial literacy in your workplace, for goodness sake, start today.


Talk story with the Ho‘ohana Community
(from 2008, as are the 1st 4 comments below):

  1. Reflections on a Sinking Economy by Brad Shorr
  2. How to Survive When Your Company’s Ship Sinks by Anita Bruzzese
  3. Faith And The Bankrupt Leader by Chris Bailey

Comments

  1. says

    Hi Rosa, A timely post indeed. One silver lining in this black economic cloud is people from all walks of life are now energized to learn about finance. I think that’s a very positive long term sign, much like broadened awareness of energy issues bodes well for the environment. Two mindsets that have been very dangerous are that government can fix all our problems and that big business knows what it’s doing. A better informed, more engaged public will demand more from its political and business leaders.

  2. says

    You’re right Brad. The recent Carly Fiona slip-up was interesting to me, for I too am of the mind that the U.S. government is in fact the biggest business in America (though certainly not our most shining example), and everyone who runs for any political office needs to understand that, continually working on their own financial awareness.

  3. says

    I really like the expression “Financial Literacy”. I must admit that I haven’t been following financial news so closely up to now, but I’ve changed my reading habits. When reading financial news or listening to them I have the experience that only few “finance gurus” are able to explain the problems in a way I can understand. And to be able to understand is the first step to learning, and to take the proper actions.

  4. says

    Ulla, I think that we’re all like you! We all need to be more financially literate, but the problem is that the so-called gurus and thought-leaders are mostly high-finance people who don’t seem to speak our language!
    I first started my financial literacy category here on TS in 2004 with the intention of urging workplace managers at all levels to be better financial info sharers and teachers for their own staff. Since then, I’ve created an SLC workshop which teaches them how to put their ‘money talks curriculum’ together —it’s a train-the-trainer kind of offering. My assertion to them is this; we didn’t learn about money management in school, and chances are that whatever we learned from our parents (if we did at all) needs to be updated in light of the current economic landscape we live in.
    Who fills the gap for us, with a subject that is frankly very scary and intimidating when it comes to learning on our own?
    Businesses have the perfect opportunity (and I personally think obligation) to be the new teachers who speak in an employee’s language ”“ it’s a win-win for everyone, synching with that coaching we’ve talked about before, to have all stakeholders work ON a business and not just IN it.