The Societal Responsibility of Banks: A Case Study of Three Swiss Alternative Banks

ABSTRACT

The ‘Great Recession’ of 2008 exposed banks and banking systems as frail economic entities, posing a threat to the real economy and society at large. This context of near economic collapse made clear the societal responsibility of banks to conform to business ethics respectful of both individual and collective interests. We argue that banks are primarily institutions of capitalism that must rely on resilient systems of reasonable values. The paper focuses on three Swiss banks to determine their ethical properties and their social ends. Such a societal dimension that we thrust on banks implies rethinking the responsibility of banks to society and their contributions to the public interest.

KEYWORDS:

• Banks
• public purpose
• private commons
• societal responsibility
• Swiss banks

JEL CODES:

• A13
• D25
• E50
• E71
• G21
• L20

Acknowledgments

The authors are grateful to the editor and to the referees for their comments, which helped improve the quality of the paper. Likewise, the authors would like to thank the persons who accepted to be interviewed to realize our study.

Disclosure Statement

No potential conflict of interest was reported by the author(s).

Notes

1 This ‘regular control’ certainly also applies to public banks. The latter’s credit flows — and more broadly, monetary and financial activities involving externalities on society — should always be channeled for the public purpose, which should be discussed, assessed and controlled by the people.