1.9 Business Ethics and Changing Values (LO1.3)

David Pottruck, former president and co-CEO of the Charles Schwab Corporation, explained the following regarding ethics and law:

At Schwab, we are constantly looking for new ways to express our values without compromising them. For example, we built the company on the principle of “no conflict of interest.” For many years, we defined that principle as “we will not give investment advice,” because we equated advice with the old-line practice of selling hot stocks to maximize brokerage commissions. When we found that our customers were demanding advice from us, we realized that our business model, one that did not compensate brokers for sales, made it possible for us to give advice and continue to avoid conflict. We changed our practice to give the customers what they wanted, expert advice that is “objective, uncomplicated and not driven by commission,” and at the same time we strengthened our commitment to our values. We feel that was a highly responsible change.50 In three to five paragraphs, discuss whether you think corporate and personal values can and/or should change over time. Specifically discuss Pottruck’s statements.