Business Ethics in Pakistan

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What is fraud? `Fraud` is deception, criminal in nature, and a misrepresentation of facts to gain an unfair advantage. It is about making claims and not fulfilling what is expected based on one’s obligations. Unless and until we do not protest these false claims, our nation’s people will carry on circumventing the laws to suit their nefarious purpose. However, is fraud just about corporations, institutions and governments? Fraud is about us

individuals caught up in the rat race of keeping up with the Joneses, all the time trying to be superior, and trampling upon each other in the process, because we deem it vital to our own financial well being and superiority in society. Fraud and dishonesty have always been the supreme shortcuts in life. People have always been lured into this practice by which they circumvent the law, and now corruption has become habitual. Fraud occurs mainly due to unemployment, poverty and the low economy of this country (Pakistan) An economy that has ultimately contributed

to an increase in the prices of every commodity including utilities such as water, electricity, gas and communication systems such as the telephone, travel (air and train ticket prices are soaring) turning the poor even poorer. This poverty has multiplied and has forced the people to devise dubious ways of making money, whether it is through fraud in business or through loot and plunder. This kind of community is now taking over and ruining the moral fabric of our society, which once was known for its legitimacy and truthfulness.

Sadly, corruption has become the norm rather than the exception. ‘Pakistani society is one that does not want to pay any taxes’ (Newsweek) This statement says a lot, rather it defines the lameness and ineffectual status of the government, which has a low hold on its civilians and seems to be unable to stem the corruption, which is burgeoning day by day. Most people here think that the government itself is highly corrupt. ‘A tax of fifty rupees will be presented in front of you as a tax of one hundred rupees’.

These things here seem complicated. As a person has to go through loads of paperwork and investigations, in which these government agents try to manipulate businessmen either by persuasive arguments, outright requests for bribes or veiled threats. These investigations have become their source of income and they will continue these underhand ways of making money unless some serious steps are taken to remove the rot from the grass roots level right up to the top echelons of the bureaucracy.

People here are beginning to lose their grip over their businesses, as the scenario of fraud at every stage is getting worse. There are claims of growth in the economy and the gradual eradication of corruption, but according to the politicians here in Pakistan every single word they utter seems to be false and an attempt to deceive the public. Businesses are collapsing, and almost one in every ten businessmen is planning to invest his money abroad, and to gradually settle down there.

If this continues, Pakistan’s assets and capital will fly out of the country, as a lot of Pakistani citizens have already left and settled outside in other countries where taxes are honestly paid and the citizens can see their taxes used for the uplift and development of the cities they live in. The only way to survive this while setting up a business is to plan carefully, especially taking the level of fraud into account. It is recommended to take advice from a person of good repute, as well as to have a sound business plan before venturing into business.

This scenario will not just haunt a business in the production of products but it will also create obstacles while investing money for capital, land etc. “This country is the second most corrupt country in the world. ” (Interview of the president, General Pervez Musharraf) The integrity of, and morality that once existed in this country has been wiped out. It has exposed itself in front of the world and Pakistan today, has a dubious international image.

We have been described as a terrorist state, a state where the climate for foreign investment is not healthy and also a state that cannot live within its means or a state that cannot manage its finances professionally. Hence we have had to resort to borrowing huge loans from the International Monetary Fund and the World Bank to bail us out of our problems against the payment of heavy interest rates. Since Pakistan’s true problems have been thus underlined, it should start taking steps towards prosperity and should try to analyse the pit it has fallen into.

Another way of getting out of these pitfalls can only be through intense supervision of the payment of taxes. The government should take serious steps in implementing the strictest laws upon businesses, and fine those businesses heavily which are not able to pay these taxes on time. I came up with a few case studies, which clearly show just how bad the situation is of the level of ethics in Pakistan. I have tried to quote some of the dialogues by a few businessmen, who are facing problems in gaining moral standards.

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