FinCris Philosophers’ Workshop
16th & 17th November 2012, Copthorne Hotel, Birmingham.
Tom Sorell (Warwick)
James Dempsey (Warwick)
Vilhjálmur Árnason (University of Iceland)
Chris Cowton (Huddersfield)
Chris Megone (Leeds)
Neema Sofaer (King’s College London)
Seumas Miller (Charles Sturt University)
Massimo Renzo (Warwick)
Mark Hannam (FairFinance and Institute of Philosophy, University of London)
John Guelke (Warwick)
Eliana Lauretta (Birmingham)
Attendees (16th only):
Zofia Stemplowska (Oxford)
Andy Mullineux (Birmingham)
Lindsay Appleyard (Birmingham)
Attendees (by Skype, morning of the 17th):
Nien-he Hsieh (Wharton)
The purpose of this workshop was to bring together an international group of philosophers to discuss how theoretical accounts of responsibility can be applied to the financial crisis. A number of different themes emerged: the relation, and tension, between individual and collective responsibility; the significance of different narrative accounts of the crisis; the importance of a good empirical grip on the complexities of the financial system; the national and regional differences in ‘the’ crisis; the significance of ‘culture’, and the different levels at which cultures exist; and the multiplicity of ‘responsibility notions’ and their interrelations. In closing discussion we agreed that an appropriate theoretical account of responsibility would focus primarily on the crisis itself. It would draw on these different themes to produce an account that was new and distinct to the subject matter, rather than simply using the crisis as a context in which to conduct old debates.
1. Tom Sorell – Responsibility in the Crisis, and Personal Responsibility for the Crisis
Tom drew on Nagel’s ‘Ruthlessness in Public Life’ to argue for an idea of individual responsibility for the crisis mediated by public institutions and the roles they create. Such responsibility is distinct from that ascribed to private individuals, both in its focus on outcomes and the kind of permissions and obligations it prescribes. In particular, there is an obligation to act impartially in the pursuit of (legal) institutional purposes. Ascriptions of individual responsibility will be informed by narratives of the crisis of which there are many, sometimes conflicting, versions, and by accounts of the purposes of relevant institutions.
2. James Dempsey – Greedy Bankers: Collective Responsibility for the Financial Crisis
James argued that we can sustain an account of collective responsibility by showing how the culture prevalent within the financial sector was directly accountable for the events of the crisis. We can then find robust standards for holding individuals morally accountable for the crisis by showing (a) that they upheld this culture and (b) that they knew, or should have known, it was illegitimate as a basis for a financial system.
3. Vilhjálmur Árnason – Multiple Responsibilities: Lessons from Iceland
Vilhjálmur argued that the activities that led to the collapse were the products of a culture or belief system that was shared across Icelandic society. Drawing upon I. M. Young’s theory of a social connection model of responsibility, he argued that an exclusive focus on blame was unproductive and Iceland should focus on forward-looking responsibilities aimed at mending weak social structures and public institutions, and building a well-functioning democratic nation.
4. Chris Cowton – Professional Responsibility in Banking: Potential Avenue or Dead End?
Chris argued that debate in business ethics tends to miss out the role of professions. He recommended that bankers within banks (‘sector professionals’) should be re-professionalised; ‘gatekeepers’ (e.g. auditors) should pay more attention to the special characteristics of banking; and ‘employed professionals’ (e.g. lawyers) should be careful to mind their professional as well as commercial duties.
5. Chris Megone – Neo-Aristotelian Insights on Responsibility and the Financial Crisis
Chris employed the Aristotelian notion of ‘mixed actions’ (those with both a voluntary and involuntary component) to analyse the actions of participants in the financial system in the run up to the crisis. He argued that to the extent that individuals were not completely constrained by their circumstances they had a responsibility to reflect on and address both their own characters and the culture in which they worked.
6. Seumas Miller – Trust, Conflicts of Interest and Fiduciary Obligations: An Integrity System for Financial Planners?
Seumas argued for a normative teleological account of both professions and financial institutions, and that aggregate needs (e.g. for appropriately priced capital) generate collective moral responsibility to design and establish institutions to meet those needs. Appropriate institutional structures allow the development of ‘integrity systems’ that allow individuals to internalise their institutional / professional duties.
7. Mark Hannam – Sub Prime Ethics
Mark argued against tracing the crisis to the greed of bankers. While some bankers may be ‘guilty’, in general any decision was made / approved by many people exercising judgment in light of prevailing wisdom. So far as bankers’ contribution to the crisis is concerned, mis-judgment of risk was probably more important than bad character, motives or a defective culture. What we now require is improved risk judgment and management at a senior level, the financial equivalent of a good ship’s captain. These are not things that philosophers are equipped to offer.