Ethics in Finance: Applying Ethical Theory to Guide Decisions and Analysis in Finance

Money and finance:Ethical considerations

“…Problems may occur if all banks adopt the same models of analysis, which may meet rational criteria when applied to one institution but whose application may generate a uniform but unmerited risk in other banks -that is, systemic risk. Other forms of harm occur when a bank seeks special regulatory treatment that may be unfair to competitors and may allow the exploitation of clients, when it practices regulatory arbitrage (taking advantage of locations where regulations are more lax) and so compromises the system's stability, or when it obstructs the orderly functioning of the markets, impairing their social role as devices for the dissemination of information and the discovery of opportunities for all (Kleinau 2014).…”