Interest.co.nz’s Bernard Hickey struck a nerve with his ‘Shut Down Crafar Farms’ blog post at nzherald.co.nz.

Some commentators felt he was ‘off-topic’ and should stick to his knitting rather than commenting on what appears to be an animal neglect case in the farming sector.

However, his post, and a follow-up article in today’s Herald on Sunday, highlight the serious risks involved in taking someone, or something, at face value, and failing to undertake due diligence in any sector. Crafar Farms is just another example amongst a litany of others, including Bernard Madoff, Blue Chip, Hanover Finance, CDO investments and so on.

Too many simply ‘follow the herd’ amidst a wave of enthusiasm and a feeling of ‘if so and so’s decided to back them, that’s good enough for me’.

It’s this eyes-wide shut mentality that continues to fuel speculative housing and other investment with people abandoning or ignoring personal concerns and warning signals, and leaping in anyway, hoping for the best. And there were more than a few warning signs associated with Crafar Farms and the other cases mentioned above.

The adage ‘if it seems too good to be true it usually is’ is one many businesses and individuals would do well to take on board. But instead of digging deeper and making informed decisions based on fact, rather than fiction, many businesses and investors continue to live by a ‘don’t ask too many questions’ philosophy that enables companies like Crafar Farms and Blue Chip to develop into disasters-in-waiting.

Allan Crafar is responsible for the neglect that occurred and should be held accountable. MAF, Fonterra and Crafar’s banks are also to blame for being instrumental in enabling Crafar Farms to grow to the point of collapse. Morally, and ethically, they had a responsibility to step in sooner and were negligent in not doing so.

Still, why should we be surprised? New Zealand’s reputation is most certainly on the line, and it will continue to be so until, at a personal, business, industry and national level, we stop taking things at face value, turning a blind eye and blaming others, and start thinking further than next quarter’s profit statement, accepting responsibility and acting with integrity.