Richard W. Painter, professor of corporate law at University of Minnesota Law School, has posted The Moral Responsibilities of Investment Bankers. In it, he explores the need for greater moral consciousness in the banking world.
An array of parties share responsibility for the 2008 crisis. Among these are not only the commercial banks, investment banks, and insurers whose investments proved so resoundingly disastrous, but individual decision makers within those institutions.
Professor Painter asserts that government regulation alone will not avert future crises—not without a simultaneous focus on individual ethics and morality in the investing profession that goes beyond bare legal obligation. While Painter posits that a variety of faiths and secular moral teaching may contribute to this discussion, he particularly emphasizes Catholic social thought.
Painter cites papal encyclicals, from Leo XIII’s Rerum Novarum (1891) to Benedict XVI’s Caritas in Veritate (2009). Altogether, they teach that the pursuit of individual economic gain occurs in a wider human community whose welfare must always be regarded as the end of that activity.
Please read the abstract after the jump: