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Dr. Kara Tan Bhala. Photo Courtesy of Kara Tan Bhala
Dr. Kara Tan Bhala chatted about her book “Ethics in Finance: Case Studies from a Woman’s Life on Wall Street.”
The author discussed some of the key ethical issues in the contemporary world of finance.
Synopsis of her book
The book “Ethics in Finance” is comprised of multiple finance and ethics case studies. The second edition adds video summaries to each chapter. The purpose of the book is twofold: First, the case studies teach readers how to evaluate and determine resolutions to ethical issues in finance. Second, the reader is taken on a journey with the author, a woman, through her years working in finance.
The case studies focus on ethical issues in finance which the author encountered over nearly a 30-year career in the industry. There are 10 cases extracted from different sectors of finance.
Each case study has a narrative describing the background, transactions, players, and ethical issues. The ethical issue is analyzed and resolved using appropriate theories of moral philosophy.
Biography on Dr. Kara Tan Bhala
Kara Tan Bhala is the President and Founder of Seven Pillars Institute for Global Finance and Ethics, USA, the world’s only independent think tank for research, education, and promotion of financial ethics.
She was an Honorary Research Fellow at Queen Mary University of London, U.K., currently sits as a Jury Member for the Ethics and Trust in Finance Global Prize based in Switzerland, and is the U.S. Ambassador for the Transparency Task Force (U.K.).
Dr. Tan Bhala has five degrees across three disciplines: a Bachelor’s (City, University of London, UK) and Masters (Oxford University, UK) in Business, a Master’s in Liberal Studies (New York University, USA), and a Master’s and PhD in Philosophy (University of Kansas, USA).
She has lived and worked in London, Oxford, Singapore, Hong Kong, New York, Washington DC., and currently resides in Kansas City, MO. She is a member of the Council on Foreign Relations, USA, and the Royal Society for Asian Affairs, UK.
How does your organization, Seven Pillars Institute, contribute to the field of ethical finance?
Seven Pillars Institute stands as the world’s only independent think tank (as far as I know) for the research, education, and promotion of financial ethics. Our primary focus is to produce publicly available research on salient financial ethics topics that informs the public, academics, and practitioners, and advances financial ethics.
I like to think we have influenced the prevailing world view in finance through our advocacy of a clearly articulated purpose, in finance and among financial institutions, and our critique of the shareholder primacy and profit maximization credos.
Since the financial crisis, considering ethics in finance is no longer a specious activity. Instead, financial ethics has gained legitimacy.
What are the core areas of focus or research within the Seven Pillars Institute?
The Institute’s output groups into four categories: case studies, Ethics 101 instruction, ethics training videos, and Moral Cents, our journal. The span of our work is quite vast.
For instance, we’ve written about the 2008 financial crisis, climate finance, cryptocurrency, impact investing, Asian financial scandals, and even a series on Goldman Sachs. There are nearly 200 case studies on our website. We offer quick primers on ethics theories through the Ethics 101 selection.
Our videos are accessible, short, and informative. The articles in Moral Cents are deep dives into diverse fields in which there are financial ethics issues.
While writing your book, Ethics in Finance: Case Studies from a Woman’s Life on Wall Street, did you come across any specific case studies that you found particularly impactful, either in terms of ethical decision-making or their outcomes?
When writing the book, I chose ten cases from my many experiences in finance, over twenty-five years. Each case exemplifies a common ethics problem encountered in finance work.
To give a few examples, there is a case on conflict of interest (Plantation Adventure Case Study), one about fulfilling unethical client requests (Bangkok Misadventure Case Study), another on insider trading (Hedge Fund Edge Case Study) and one that covers implicit bias and gender discrimination (Finance Academy Gender Inequity Case Study).
Each chapter of the book follows the same structure: the story – in which I provide a narrative of an encounter or experience, followed by an explication of what I see as the ethics issue in the narrative. The book is an informative memoir.
What are the key ethical issues and challenges in the world of finance today?
First, we need to look at the big picture – whether we can continue with the neoliberal economic system we’ve used since the middle of the 20th century. Is the model still fit for purpose in the 21st century with its critical problems of climate change and inequality – global and local?
Second, what will happen with ESG (ethics, sustainability, governance) investing? So far, we have quite a bit of greenwashing among corporates, and subsequent push back from reactionary forces.
The field is currently in its epistemological infancy. Will it mature and develop respectable and agreed upon measurement frameworks? Third, we need to focus on teaching ethics in finance in business schools. Will financial ethics be a required course for all undergraduate business majors? This isn’t the case currently.
How can ordinary consumers support and promote ethical finance in their communities?
In their communities, consumers should speak up when they encounter unethical behavior by their financial institutions or other organizations that deal with money. Write to their local representatives to complain about unethical practices. Finally, consumers can teach their children the value of values.
“Ethics in Finance” is available on Amazon by clicking here.
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