The Colors of a Banker's Soul

Imagine taking a walk around Wall Street in New York City or Canary Wharf in London. How many types like Gordon Gekko will you meet? Or will you simply find that people working in these financial hubs reflect the values of the US and UK societies?

Much is said and assumed about bankers. Movie depictions show them as greedy money-making machines. A dysfunctional banking culture has been blamed for the 2008 financial crisis. And yet, we know surprisingly little about bankers' values and whether they differ to society's. In my paper "The Distinctive Values of Bankers", co-authored with Nava Ashraf (LSE) and Oriana Bandiera (LSE), we ask bankers what qualities they would want to pass on to their children as a way to elicit of their personal values. Respondents are given a list of eleven values, such as determination, thrift, faith, responsibility and asked to pick their preferred ones. We survey over thirty-five thousand employees belonging to a single multinational company that operates in more than fifty countries.

In each country, we first compare bankers' values with those of society at large (using data from the World Value Survey). For some values, such as responsibility and independence, bankers do reflect the society they live in. However, we also find five "distinctive" values:
bankers tend to put more weight on determination and imagination and less weight on faith, obedience and thrift compared to the rest of their society, independently of where they are located.

Remarkably, those values that distinguish bankers from society are also the values where the top and bottom ranks within the bank largely differ. Across countries, the bottom ranks are always closer to society than the top ranks. Thus, for example, all bankers are more determined than the average citizen but top ranks are more determined than bottom ranks. This suggests that banking does not attract types that are different from the average person from the outset, but rather that those bankers who rise to the top are most distant from their societies. According to this explanation, we should be able to see a link between promotion and values.

We indeed find that bankers are rewarded for aligning with precisely from those values that form the distinctive bank culture. Bankers who value imagination and determination are more likely to be promoted; those who value thrift, obedience or religious faith are significantly less likely to be promoted. Those values that are not distinctive to the bank have no relationship with either performance or promotion.

To sum up, what do these results tell us about banking and its culture? First, in some values, bankers seem to be different from society at large. Secondly, types which are distant from society do not seem to select into banking, but they do get to the top ranks. An implication of these results is that banks, and organizations more widely, may face culture traps. Values can outlive the reason they were chosen in the first place by persisting among the top ranks of the organization – and this can explain why organizational culture is impervious to change. For the individual, a trade-off emerges: should bankers' values be coherent within the organization and dissonant with society or vice-versa? What would be best for society? These and other questions are left for future inquiry.