The Ethics of Banking: Conclusions from the Financial Crisis (Issues ...

The Financial Crisis – Systems Crisis or Action Crisis? 185
Likewise in Hans-Werner Sinn’s analysis of the crisis, the idea of systemic error
is in the foreground. The search for the guilty parties makes little sense, “because
misconduct became the normality.” 58 The system conception dominates the interpretation
of business in economic theory. It can find no place for personal ethical
responsibility and therefore denies it. The importance of the system perspective is
not disputed here. What can be disputed, however, is whether it is the sole perspective.
Two objections spring to mind: first, why did not all the banks follow the
perverse incentives with which the system, according to Posner and Sinn, was riddled?
Second, what were the historical roots of such a massive unleashing of the
enrichment motive in the finance industry, on a scale hitherto without precedent in
a capitalist financial system? The answer to both questions must be that the idea of
“purely economic economics” created a new, previously unknown model and system
of the financial sector, which was and is the opposite of an ethical economy in
which those doing business within the system feel bound by ethical orientations to
“good conduct” in pursuit of the industry’s purpose. “Good” means, here, good in
an encompassing way that includes not only the private but also the public interest.
The new model of the deregulatory Big Bang of the finance industry cast the
financial market in an even more egotistical light than the old “selfish system” of
the market. It legitimated uninhibited self-interest – in contrast to the enlightened
self-interest of classical market theory – and transformed the “selfish system” into
an “ultra-selfish system” in comparison to the previous theory of the regulated financial
market. The ultra-selfish system went beyond the old laissez-faire school and
created the stereotype of a financial manager and intermediary pursuing only his
own self-interest and that of the shareholder; not bound by any criteria concerning
the good of the firm or the customer, whose fiduciary duty is devoid of normative
content and follows nothing but considerations of advantage. The ultra-selfish system
had a new ferocity. It had been the objective of financial market reforms to
create a new financial system without any ethical or welfare orientation out of the
nothingness of a deregulatory Big Bang; a system in which the general equilibrium
of the egotism of actors in a perfect market was expected to produce optimality.
It signaled a jettisoning of any orientation to business ethics, although the market
system in no way compelled this and not all actors chose to go along with it. Not
all banks went bankrupt even in the USA. They did not pursue the courses of action
which Posner and Sinn consider to be in keeping with the system imperatives and
unavoidable within the framework of the system. The system clearly leaves room
for ethical decisions and for strategies that are not dominated by the idea of making
the fast buck.
Certainly, some of the causes of the financial market crisis lie outside the sphere
of influence and ethical responsibility of financial actors, and cannot be fully
remedied by business ethics alone. 59 Not all trends in the financial sector, then
58 SINN (2009), p. 99.
59 A balanced combination of business ethics, reputational pressure on the banks and state regulation
is necessary. Cf. BAKER (2008), 734: “How do we get the intermediaries – corporate