In the wake of the global financial crisis, the various political responses it has triggered, and the emergence of new forms of fiscal and monetary policy, the need for a more sophisticated encounter between economic theory and the social sciences has become pressing. The growth of new forms of money and finance is increasingly recognised as one of the defining developments of our time, and it is beginning to yield innovative research across the humanities and social sciences.

Following on from the success of our inaugural conference last year, this two-day event aims to foster the further development of dialogue between the diverse camps that make up the new field of ‘finance and society’ studies. In particular, it seeks to identify new synergies between heterodox political economy and various sociological, historical, and philosophical perspectives on the intersections of finance and society.

Confirmed keynotes

  • Melinda Cooper (University of Sydney), ‘Anti-austerity on the far right’
  • Joseph Vogl (Humboldt University of Berlin), ‘The ascendancy of finance’

Submissions are invited in two formats

  • Papers; abstract of up to 300 words
  • Panels; panel proposal plus paper abstracts

Please submit abstracts and proposals by 1 August 2017 to Martijn Konings and Amin Samman at the following address: intersectionsfinancesociety@gmail.com

Finance and Society are encouraging paper submissions from conference participants. If you would like to discuss this further then please contact one of the journal editors. The full programme for last year’s event is available from the 2016 conference website.

Bank culture has featured prominently in the debate on financial reform. Culture, including values and beliefs, was at the center of the infamous “Muppets memo” penned by the resigning Goldman Sachs banker. Culture is the focus of the promises made by politicians and regulators to fix, once and for all, the City and Wall Street. And culture received a full chapter in the recent Salz Review of the problems at Barclays that led to the LIBOR scandal.

If one listens carefully, however, one can hear politicans doing the same verbal trick. Having denounced bank culture, they promise to remedy bank structure. E.g., separate (or, more creatively, “ring-fence“) investment and retail banking. Banish prop trading. And so on. This is not unreasonable, as the structure is really what regulators can intervene on. But years of organizational theory suggest that enduring change in organizations is impossible simply through formal measures — that is, in the absence of cultural change. As recent press reports have shown, cultural change is now very much taking place in seminars and value statement-writing sessions in the City. Canary Wharf appears to be teeming with PowerPoint-ready culture consultants.

Given this, I am organizing a panel discussion on bank culture (together with Nina Andreeva and Jean Pierre Zigrand). What are the promises of cultural reforms? What are the challenges? How does culture interact with structure? To this discussion, I invited a banker from Goldman, another from a top bank, a bank consultant in cultural change, and a prominent bank blogger from The Guardian. And I plan to combine them with regulators and academics: with Mike Power, an officer at the FCA, Nina Andreeva, and myself.

All in all, there will be two panels of four people. Each speaker will have about five minutes (vigorously enforced by the moderators). There will be 30 minutes of Q&A after each panel. And then drinks and nibbles. The event will take place at the spanking new LSE Systemic Risk Centre on November 21st from 4.00 onwards. It is free and open to the public, but registration is necessary. Please write to src@lse.ac.uk

Here’s perhaps the most intriguing observation I came upon in my five years of fieldwork on responsible investment. Sitting in an elegant whitewashed office in New York, curated African art on the walls, a white-haired financier explained to me why he took to responsible investment. “In the 1960’s,” he explained, “if you wanted to communicate with Bank of America, one way was to stand outside the corporate headquarters and throw a rock at the building.” By contrast, nowadays corporations such as Wal-Mart sit down with responsible investors to discuss their labor, environmental or governance policies.

Movements, the gentleman seemed to imply, could now leverage capitalism’s own mechanisms to reshape the system. Too good to be true?

A symposium in the upcoming Academy of Management in Boston explores precisely this issue. That is, the non-confrontational tactics that movements deploy to reshape the corporate agenda. It is organized by Fabrizio Ferraro, Brayden King and myself. And it will benefit from the comments of Huggy Rao (author of Market Rebels).

Here’s the session description from the official conference site:

Social movements have recently focused their activity on direct influence over corporations by targeting consumers and investors. Most studies of this trend have emphasized confrontational means such as protests and boycotts. But confrontation is not the only way to exert influence. The proposed symposium explores alternative tactics movements deploy. One is shaping the public discourse, such as shifting management attention towards more sustainable technologies. Another is shareholder engagement, which provides opportunities for activists to express their voice. A “big tent” approach could also be deployed to gain legitimacy for the emerging field of responsible investing. And last, corporations are also becoming active agents in supporting boycotts of competing firms, thus borrowing from the repertoire of movements.

And the list of presenters:

Influence of Non-confrontational SMO Tactics on Technology Adoption in the Energy Sector
Presenter: Shon R Hiatt; Harvard Business School;

Bringing Voice Back in the Market: A theory of shareholder engagement
Presenter: Fabrizio Ferraro; IESE Business School and Daniel Beunza; London School of Economics;

Tactical Mimesis in Private Politics: Companies’ appropriation of a contentious social movement
Presenter: Mary-Hunter McDonnell; Northwestern U.;

The Big Tent: Enacting demand for responsible investment
Presenter: Daniel Beunza; London School of Economics and Fabrizio Ferraro; IESE Business School;

The Impact of a Corporate Culture of Sustainability on Corporate Behavior and Performance
Presenter: Ioannis Ioannou; London Business School;

And the details:

Program Session #: 1789 | Submission: 13927 | Sponsor(s): (OMT, SIM, BPS)
Scheduled: Tuesday, Aug 7 2012 3:00PM – 4:30PM at Sheraton Boston Hotel in Republic A

Update on the Blank Swan

November 4, 2010

A quick update to highlight the paper Elie Ayache just kindly pointed to in comments to a recent plug: “The End of Probability”. Thanks Elie!

BTW: More philosophy for “after the market” (in French) at Elie Ayache’s Après le marché.

The Blank Swan

October 12, 2010

Of possible interest to blog readers:

Quant Elie Ayache uses philosopher Quentin Meillassoux (his book After Finitude) in a talk about his recent book, The Blank Swan: The End of Probability. Clips of the talk (quite intriguing) available here, here and here. More on Ayache at ITO 33 and at Willmott.

Hat tip to Speculative Heresy.

There is no doubt that Obama’s address to Congress on heath care last night was a superb piece of political craftsmanship.  The purpose of the speech was to take the issue back from the boarders of fringe discussions.  By casting health care as a moral-national imperative, he made a hard-to-dodge (unless you’re an unpatriotic jerk) argument that there should be bipartisan agreement on the definitive need for a heath coverage plan of some kind, even if the details are not fully consensual. The address was designed to re-secure political will.

The US heath care debate is largely a question of finance.  Two points of the proposed plan struck me as potentially interesting sites of empirical research.

1. An insurance exchange to replace the idea of a federally run heath care program. “Now, if you’re one of the tens of millions of Americans who don’t currently have health insurance”, Obama said, “the second part of this plan will finally offer you quality, affordable choices…We will do this by creating a new insurance exchange – a marketplace where individuals and small businesses will be able to shop for health insurance at competitive prices. Insurance companies will have an incentive to participate in this exchange because it lets them compete for millions of new customers. As one big group, these customers will have greater leverage to bargain with the insurance companies for better prices and quality coverage.”

A non-profit insurance agent run by the state has been trounced on all sides.  It’s been found offensive on the grounds that the government can’t be trusted to run anything efficiently; AND on the grounds that private insurers could never compete against a government run agency.  Now that this idea seems to have been displaced in favor of a more palatable ‘marketplace’, my question is: What kind of market device will have to be built to get such an exchange going?  Who is going to build it?  And what will be the role of government in designing the dimensions of this exchange?

2. The cost of good care. Although recycling savings from improved efficiency within the existing system to pay for extended coverage to include more people sounds appealing, there has been very little said in the debate to examine how costs are built into medical practice.  Over treatment to protect against tort law is only one part of this.  Incentives for compensation are another.  As the eminent physician, Dr. Relman commented in the NYTimes today, “The main drivers of medical inflation are fee-for-service payment of physicians, and all the other incentives in the current medical care system for increasing providers’ income. We will not control costs without major changes in the way medical care is organized, delivered and paid for.”

As medicine and finance intervene, there is an excellent opportunity opening up to recapture some of our science studies roots.  Forget superfluous costs for a moment. What are the costs within the practice of ‘good’ medicine? How is a cost calculated when it is confronted with scientific efficacy?  It seems that there are things to be learned by looking at how costs are ballooning within the very heart of what it means to interact with and intervene upon the body from a sound medical perspective.

In a (too) simple example, medicine is an industry that pushes for disposable, single-use consumption. Where tools were once sterilized and reused, latex gloves, paper sheets, the plastic speculum etc… medical practice calls for more and more disposable things and technologies. (This reminds me of the difference between a French café where the counter attendant washes out the cup and spoon by hand with a cloth rag at a sink, and a Starbucks, where they give you a full sized cup for a single expresso, a disposable stick, and a paper girdle to keep you from burning your hands, all of which are promptly disposed in a trash can.)  How is this happening from a cost perspective, and why?

Health care. It’s the next frontier of financial research…