This course critically examines the ethical challenges in modern finance and explores alternative models that prioritize social and environmental well-being. It investigates how financial systems can move beyond profit maximization to foster sustainability, fairness, and long-term prosperity. Through theoretical discussions and practical examples from international networks of ethical finance, students will develop the skills to assess and promote ethical financial solutions.
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Module 1: The Ethical Challenges of Finance
Modern finance is often seen as a driver of prosperity, but does it truly benefit society? This module explores the criticisms of mainstream finance, including financial speculation, unfair fiscal practices, market failures, inadequate risk managing of global treats and regulatory loopholes. It also examines the role of ethics in restoring trust in financial institutions.
Module 2: Ethics in Economic and Financial Thinking
What does it mean to think ethically in general terms and in finance? This module introduces key ethical theories and their application to economic decision-making, questioning the traditional assumption that markets are purely self-regulating and value-neutral.
Module 3: The Emergence of Ethical Finance
Ethical questioning around finance starts from the very beginning of banking in middle age times. Modern Ethical finance has historical roots in social movements, religious traditions, and cooperative banking. This module traces its development, from early socially responsible banking and investing practices to the rise of value-driven financial models.
Module 4: Financial Instruments and Ethical Practices
Ethical finance applies its principles to financial products and services, promoting transparency and sustainability. This module explores the social function of finance and banking and provides tools to understand what ethical reasoning in finance means. Pratictes and processes are presented for ethical banking, green loans, microfinance, and financial intermediation practices that prioritize social impact over pure profit.
Module 5: Responsible and Sustainable Investment
Investment decisions shape the future. This module examines ethical and sustainable investment strategies, impact investing, and the role of environmental, social, and governance (ESG) criteria in guiding financial choices. Difference between sustainable and ethical finance is clarified.
Module 6: Governance and Accountability
Ethical finance requires responsible governance and a coherent design of the management of the financial operators. This module looks at ownership structures, decision-making processes, transparency, and risk management, highlighting how financial institutions can balance profitability with ethical commitments.
Module 7: Measuring Impact
How do we assess the real-world effects of financial decisions? This module introduces tools for measuring financial, social, and environmental impact, considering both their potential and limitations in driving change.
Module 8: The Role of Policy and Regulation
Public policies and regulations shape the financial landscape. This module explores how governments, institutions, and consumers can support ethical finance, including through regulatory frameworks and financial citizenship initiatives.
Module 9: Ethical Finance and Community Development
Finance can empower communities. This module examines cooperative banking, mutual aid financial models, and solidarity-based approaches that prioritize collective well-being over individual gain.
Module 10: The Future of Ethical Finance
Can ethical finance become mainstream? This final module discusses the challenges and opportunities for ethical finance in a digital and globalized world, considering strategies for scaling up its impact and fostering a financial system that truly serves society.
The course will be based on the textbook U. Biggeri, G. Ferri, F. Ielasi, P. Sasia, Ethical finance and prosperity: Beyond Environmental, Social and Governance Investing, Routledge International Studies in Money and Banking, 2023
Other readings and materials will be provided to students.
Other suggested but not mandatory readings are provided below:
K. Kaufer, & L. Steponatis, Just Money: Mission Driven Banks and the Future of Finance, MIT Press, 2021
(Eds.) A. Nicholls, R. Paton, & J. Emerson, Social Finance, Oxford University Press, 2015
L. Bruni, & S. Zamagni, Civil Economy: Efficiency, Equity, Public Happiness, Peter Lang AG, 2007
Wolfgang Sachs, The Sustainable Development Goals and Laudato si’: varieties of Post-Development?, Third World Quarterly, 2017, pp. 1-13
Jackson, T. [2016], Prosperity without Growth: Foundations for the Economy of Tomorrow, 2nd Ed. Routledge, ISBN 978-1138935419.
Biggeri, U., Meggiolaro, M., & Sorrosal, D., Ethical Finance in Europe, Fifth Report, Fondazione Finanza Etica, Fundaciòn Finanza éticas, Febea publication, ISSN 978-88-945182-2-1., 2022
Bank of England, Money creation in the modern economy, in «Quarterly Bulletin», Q1, 2014 (https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/ money-creation-in-the-modern-economy), pp. 14–26
Kahneman, D., & Tversky, A. Prospect Theory: An Analysis of Decision under Risk. Econometrica, 47(2), 1979, pp. 263–291
Kocornik-Mina, A., Bastida-Vialcanet, R., & Eguiguren-Huerta, M., Social impact of value-based banking: Best practises and a continuity framework, in «Sustainability», 13.14 (2021) pp. 1-40
Sen, A.K. [1987], On Ethics and Economics, Malden, MA, Blackwell
________________________________________
Module 1: The Ethical Challenges of Finance
Modern finance is often seen as a driver of prosperity, but does it truly benefit society? This module explores the criticisms of mainstream finance, including financial speculation, unfair fiscal practices, market failures, inadequate risk managing of global treats and regulatory loopholes. It also examines the role of ethics in restoring trust in financial institutions.
Module 2: Ethics in Economic and Financial Thinking
What does it mean to think ethically in general terms and in finance? This module introduces key ethical theories and their application to economic decision-making, questioning the traditional assumption that markets are purely self-regulating and value-neutral.
Module 3: The Emergence of Ethical Finance
Ethical questioning around finance starts from the very beginning of banking in middle age times. Modern Ethical finance has historical roots in social movements, religious traditions, and cooperative banking. This module traces its development, from early socially responsible banking and investing practices to the rise of value-driven financial models.
Module 4: Financial Instruments and Ethical Practices
Ethical finance applies its principles to financial products and services, promoting transparency and sustainability. This module explores the social function of finance and banking and provides tools to understand what ethical reasoning in finance means. Pratictes and processes are presented for ethical banking, green loans, microfinance, and financial intermediation practices that prioritize social impact over pure profit.
Module 5: Responsible and Sustainable Investment
Investment decisions shape the future. This module examines ethical and sustainable investment strategies, impact investing, and the role of environmental, social, and governance (ESG) criteria in guiding financial choices. Difference between sustainable and ethical finance is clarified.
Module 6: Governance and Accountability
Ethical finance requires responsible governance and a coherent design of the management of the financial operators. This module looks at ownership structures, decision-making processes, transparency, and risk management, highlighting how financial institutions can balance profitability with ethical commitments.
Module 7: Measuring Impact
How do we assess the real-world effects of financial decisions? This module introduces tools for measuring financial, social, and environmental impact, considering both their potential and limitations in driving change.
Module 8: The Role of Policy and Regulation
Public policies and regulations shape the financial landscape. This module explores how governments, institutions, and consumers can support ethical finance, including through regulatory frameworks and financial citizenship initiatives.
Module 9: Ethical Finance and Community Development
Finance can empower communities. This module examines cooperative banking, mutual aid financial models, and solidarity-based approaches that prioritize collective well-being over individual gain.
Module 10: The Future of Ethical Finance
Can ethical finance become mainstream? This final module discusses the challenges and opportunities for ethical finance in a digital and globalized world, considering strategies for scaling up its impact and fostering a financial system that truly serves society.
The course will be based on the textbook U. Biggeri, G. Ferri, F. Ielasi, P. Sasia, Ethical finance and prosperity: Beyond Environmental, Social and Governance Investing, Routledge International Studies in Money and Banking, 2023
Other readings and materials will be provided to students.
Other suggested but not mandatory readings are provided below:
K. Kaufer, & L. Steponatis, Just Money: Mission Driven Banks and the Future of Finance, MIT Press, 2021
(Eds.) A. Nicholls, R. Paton, & J. Emerson, Social Finance, Oxford University Press, 2015
L. Bruni, & S. Zamagni, Civil Economy: Efficiency, Equity, Public Happiness, Peter Lang AG, 2007
Wolfgang Sachs, The Sustainable Development Goals and Laudato si’: varieties of Post-Development?, Third World Quarterly, 2017, pp. 1-13
Jackson, T. [2016], Prosperity without Growth: Foundations for the Economy of Tomorrow, 2nd Ed. Routledge, ISBN 978-1138935419.
Biggeri, U., Meggiolaro, M., & Sorrosal, D., Ethical Finance in Europe, Fifth Report, Fondazione Finanza Etica, Fundaciòn Finanza éticas, Febea publication, ISSN 978-88-945182-2-1., 2022
Bank of England, Money creation in the modern economy, in «Quarterly Bulletin», Q1, 2014 (https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/ money-creation-in-the-modern-economy), pp. 14–26
Kahneman, D., & Tversky, A. Prospect Theory: An Analysis of Decision under Risk. Econometrica, 47(2), 1979, pp. 263–291
Kocornik-Mina, A., Bastida-Vialcanet, R., & Eguiguren-Huerta, M., Social impact of value-based banking: Best practises and a continuity framework, in «Sustainability», 13.14 (2021) pp. 1-40
Sen, A.K. [1987], On Ethics and Economics, Malden, MA, Blackwell
- Teacher: Ugo Biggeri
- Teacher: Beniamino Pisicoli