Friday, July 3, 2015

Questionable Conduct

Mid-Feb 1996

The Rush to Rent has taken a toll on the farm customs many of us thought were written on the back of the Ten Commandments. Most of these rules of conduct were developed in an era long past in time and economic conditions.   Increased pressure to expand and fierce competition for share-rent acres especially, have led us to rethink what is and is not acceptable practice. 

The growing scarcity of traditionally share-rented land, the explosion in operator ability to farm additional acres, and several years of respectable farm profits are combining to reshape the rental power structure to favor landowners. Added to that, is the great Real World Problem in the conventional wisdom to expand by renting: Most land rents to sons, nieces, family friends, boyfriends from 40 years ago, etc. Such factors are pretty much out of our control.

Given these difficulties, some of the accepted rules of social and business conduct seem to be irrelevant, even counter-productive when competing for land. Being a "nice guy" doesn't always seem to bring the reward from landowners we had somehow assumed would follow when it was "our turn". If the old model of dignified patience and circumspect behavior with landowners is not the standard, then what practices are ethical and economically effective? Some suggestions:

  1. Consideration for others is never inappropriate. Funeral home inquiries, malicious gossip, or insensitive prying will not prove to be a solid basis for business expansion, regardless of the occasional brief "score".  Luckily, I have survived long enough to see some jerks that operate this way get their due rewards, and I don't miss them.  Successful land-owner/tenant relationships are based on trust founded in mutual respect. A farmer who has no respect for grief, privacy or truth is usually undone by his own devices. If you are among the no-holds-barred, ultra-aggressive believers, be careful not to underestimate the long term antipathy of your victims. There is an eerie, albeit slow justice system in the farming community.
  2. Recognize the new level of competition in our industry. When a small tract of land near me came up for rent, the farm manager had over 50 inquiries. Given this demand, landowners now have much greater leverage than when many of the share-rent traditions were first established. Expect changes, and to anticipate them, stay in good communication with your landowners. Do not demand that tradition protect your right to farm over the rights of others who wish to farm.
  3. Respect the rights and interests of all landowners. Landlords are not concubines in a farmer's harem. They can talk to whomever they wish about whatever. What we would think if machinery dealers decided who farmers should or should not talk to about machinery deals?   You may fear the wrong thing anyway. In my discussions with owners, I have found they usually don't want to change the tenant; they want to change the results.  
  4. Consider ownership.  If you think landlords have too much power, perhaps you should join them. This is heresy, I know, in this era of Rent Your Way To Success, but my observation is that big renters come and go - small owners hang on forever. Maybe paying too much for land (and it always is) isn't such a bad idea.
  5. Don't perpetuate the problem. If you haven't discussed with your wife (at least) how to handle your abrupt departure from the scene, you are helping to create an environment where unfortunate behavior can occur. Succession plans show your commitment to principled standards of professional conduct, and spares those you care for unneeded hassle.
  6. Don't do stuff you don't want to do. If you cannot respect your own conscience in business matters, you have lost control of your professional future. Behavior that you know down deep is not honorable probably isn't. If you match the lowest common denominator of business ethics practiced by competitors, be prepared for gruesome rewards of self-hatred.
  7. Get used to working in broad daylight. You may be skilled in quiet negotiation and behind-the-scenes maneuvering, but land rents are now frequently done in open bid, or even auction by uninvolved third parties. Learn how to represent yourself on paper or in an interview, and how to differentiate yourself on a business basis from your competitors.
  8. Don't expect community approval to insure your success.  The power of local communities to determine who should and should not farm decreases with county-hopping large operators and distant landowners. Doing all the things your father did may not be enough to survive.
  9. In unexpected situations, remember the Golden Rule. Amazingly, it will work every time. 

Ethical behavior when trying to rent ground is no more difficult than when conducting all other aspects of life.  Balancing social approval with personal goals develops a personal value system. As farms grow, the problem comes in determining where our "community" is and our loyalties lay - where we live, where we farm, or perhaps something much larger? The way you choose to act, and how it affects others, determines the ethical standards of your business community.

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