What Would it Take to Change?
When bankers are reminded they are bankers, a new study has found, they are more likely to lie.
A team of economists at the University of Zurich has found evidence that banking culture encourages dishonest behavior. According to a study reported in Nature, bankers lied more than those in other professions when reporting the results of a coin toss.
The researchers, noting recent scandals in the banking industry regarding manipulated interest rates, rogue traders and fraud, wanted to find out “whether the business culture actually renders bank employees more dishonest, or whether more-dishonest people simply choose to work in the banking industry.”
In devising the test, the researchers reminded the bankers of their professional identities before tossing the coins, a technique that is called “priming.”
So one would have to wonder – and worry – if their identities as bankers had that effect on a coin toss, what about when real money was involved? A tendency to be morally soft when faced with hypotheticals can become far more serious when the temptation of a deal involving millions or an important career opportunity is at stake.
Can anything be done about this? Alain Cohn, who is now with the University of Chicago, suggested banks should take a page from medicine and require their own version of the Hippocratic oath. “It is very important to let employees know exactly what desired and undesired behaviors are . . . . Then we could use a professional oath to activate these norms.”
Not so simple, I think. The power of the Hippocratic oath derives in part from its venerable age and universal acceptance. When a doctor takes the oath he or she knows that over the years hundreds of thousands of doctors have taken it before, and they stand as witnesses to it importance. Moreover, he or she knows that the oath is part of what it means to be a doctor. Before they start their training, they grasp their obligation to subscribe to it.
On the other hand, getting bankers to change would not be a simple matter. Businesses that want to change their cultures to make employees more engaged and assertive are finding just how hard that is.
The profession itself would have to rebalance its priorities, not just ask new members to be more honest. New bankers, clearly, will do what they see being done by old, established, successful bankers – and that is not just a matter of “talking the talk.” There would have to be reflection on the temptations to be dishonest, and serious penalties for violations. And it would be a good idea to start with self-policing, the kind of ethical boards that investigate consumer complaints, not just rely on government investigators to find the miscreants and prosecute.
Frankly, it is not a promising sign that this study was initiated by academics. Universities have a long and honored tradition of scholarship – going back almost as long as medicine’s link to Hippocrates. As a result, academics understand they are accountable for their work, but they may overestimate the ability of other professions to be ethical.
Establishing an oath is not a bad idea, but that would have to be just the first step in an arduous and prolonged process.