DOES IT MATTER WHO YOU DO BUSINESS WITH?

The recent murder of dissident journalist Jamal Ahmad Khashogghi by Saudi Arabian operatives presents a moral challenge for many businesses, including prominent horse-racing enterprises who have customers from the Saudi royal family.

Currently, the United States and other nations are being urged by citizens and elected officials of all political stripes to severely sanction Saudi Arabia over the killing of Mr. Khashoggi at the Saudi Arabian consulate in Istanbul. Though Saudi Arabia has denied that Crown Prince Mohammed bin Salman ordered the assassination, the Kingdom does not dispute that Mr. Khashoggi was murdered by Saudis with connections to the House of Saud.

Sanctions create a practical dilemma in that Saudi Arabia can drive up the world price of oil and is a major customer of multinational companies and an important source of funds for Silicon Valley high-tech startups.  In addition, Saudi Arabia could adversely affect prices on equity and bond markets if it were to sell its vast holdings in anticipation of or retaliation for economic sanctions.

So firms dependent on Saudi Arabian business face a dichotomy of fact and value.  On the one hand, a Saudi boycott would cost them plenty monetarily.  Yet, one may be uncomfortable doing business with a nation that has an indisputable record of human rights violations, including repression of women, and, moreover, was a breeding ground for fifteen of the nineteen perpetrators of the September 11, 2001 attacks in the United States as well as the mastermind.

Over the years, prominent members of the House of Saud have been deeply involved with horse breeding and racing.  They have spent millions of dollars at horse sales, owning farms across the world, employing thousands, and thereby providing economic fuel for the global Thoroughbred industry.  While it can be argued that Saudi racehorse owners may be upstanding individuals with no direct involvement in atrocities and repression, the fact remains that most of them are members by blood of the ruling House of Saud and therefore are at the very least accessories.

Horse trainers, auction company executives, and others with a vested interest turn a blind eye to Saudi human-rights violations because they won’t alienate deep-pocketed patrons.  Their posture is similar to corporate giants like Boeing and Raytheon and numerous California startups that depend on Saudi Arabia for investment, or even to consumers who enjoy low gas prices at the pump.

Businesspeople, including those in horse-racing, can rationalize commercial ties to customers and employers who may be complicit in crimes against humanity: “Keep business separate from politics” or “They are no worse than Russian oligarchs.”

Democratic governments and basically good individuals have a long history of conducting business with bad actors.  Yet, rationalizations aside, doing so may, or should, trouble one’s conscience…at least a little bit.

Copyright © 2018 Horse Racing Business

Comments

  1. Trainers who work for the Royals in Saudi Arabia, Dubai, and Qatar must be bothered by their owners’ treatment of gays, women, Christians etc. When they are offered horses like Point Given and Frankel money and prestige trump ethical concerns.

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