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Virtues Are as Important as Values

Virtue is a fitting concept to think about as we observe Ethics Awareness Month in March. Our industry spends much time promoting the concept of values but much less time on the concept of virtue. This is unfortunate because we need a clear understanding of the importance of virtue so that we can better live our values.

Values are beliefs about those things that are good and important. Values are identity-constituting, since what we believe to be good and right defines who we think we are as individuals and how we wish to represent ourselves to the outside world. Shared values can be a tremendous source of cohesion among members of a group who can support each other in living their values.

People with similar values find it easy to be in each other’s company because they operate under the same assumptions that they take for granted those actions they should perform and those actions they should avoid. At the same time, groups whose members have dissimilar values are often tenuous and unstable. Because they have different conceptions of the good, they have different priorities. Thus, it can be challenging to unify individuals within such a group behind a coherent plan of action.

At this point, we have not mentioned whether there are “good” values or “bad” values. Clearly, groups throughout history have embraced values that are exclusionary and even harmful to other groups. There are business organizations that have chosen to pursue their values in a way that violates their genuine obligations.

It is often said, “When your values are clear, your decisions are easy.” This does not necessarily mean that your decisions are good. In short, while values might serve as a shorthand rationale for those things that we prioritize, it does not necessarily imply that those values are the right values in the sense of meeting our obligations to other people and ourselves.

A Mistake to Shy Away

Many people shy away from the term “virtue” because of its “Sunday school” connotation, but this is a mistake. The idea of moral virtue was first discussed by the Greek philosopher Aristotle, who lived around 400 B.C.

According to Aristotle, virtue is a disposition or a tendency to act well in a certain area. Virtues provide us with the ability to “see” the world in the right way. The virtuous action represents the middle point between excess and deficiency. Aristotle argued that acting virtuously promotes the physical, emotional and social flourishing of the individual.

Consider three well-known virtues: generosity, justice and courage. Generosity enables us to identify correctly situations in which generosity is called for and then identify which form the generous action should take in that particular case. Justice helps to identify situations of injustice and to know what just action is required. A courageous person knows when an act of courage is required and what action should be taken in that particular situation. Virtue, then, enables its possessor to identify situations in which moral actions are required and to perceive the correct response.

How do virtues connect with values? Values themselves say nothing about how to identify situations in which a value is at stake or what it means to “live” that value. For example, many organizations have adopted “respect for others” as a value. However, the virtue of justice is necessary to identify situations in which people are being disrespected and to identify the necessary actions to take in each particular situation.

Why Virtue Is Necessary

Virtues can help to adjudicate when there is a value conflict. For example, if an individual values both “promise-keeping” and “promoting the good of her clients,” she may feel torn when it appears that the only way to look out for the interests of her client is to break her promise of confidentiality. Clear values make for easy decisions only when there is one value at stake.

Finally, possessing virtue is essential to being an excellent financial advisor. Acting responsibly as a financial professional requires several virtues: courage to know when and how to have difficult conversations with your clients, justice to know how to distribute your limited resources among your clients and others who depend on you, and proper humility to describe accurately your accomplishments and skills to clients and prospects.

How do you become virtuous? A colleague recently commented that change happens when “pain pushes until the vision appears.” Recall that virtue promotes happiness. People who are miserly, cowardly and unjust are often unhappy and socially isolated. They will begin to change when the “pain pushes” them to do so.

However, this does not need to be a solitary affair. Aristotle believed that people learn to be virtuous through living in virtuous communities. We learn to be virtuous by watching other virtuous people, and we are motivated to be virtuous when we see positive changes in our own lives. This is why building an organizational culture that supports both virtues and values is so important.

During Ethics Awareness Month, we should not only challenge ourselves to think about our values and how they connect us (or disconnect us) from our communities, but we should also think about how we can change ourselves for the better by becoming more virtuous individuals. We will be the happier for the effort.


Julie Anne Ragatz is director of the Cary M. Maguire Center for Ethics in Financial Services and assistant professor of ethics at The American College. [email protected].

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