Business Students Are Hoping to Change Ethics in Finance for the Better – Barron's

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Young business students are growing more concerned with upholding their values and ethics while navigating their careers.


About the author: JC de Swaan is the author of Seeking Virtue in Finance: Contributing to Society in a Conflicted Industry (Cambridge University Press).  He is a lecturer in the economics department at Princeton University, where he is affiliated with the Bendheim Center for Finance. He is also a partner at Cornwall Capital, an investment fund based in New York.

Finance careers remain in high demand among students. Goldman Sachs received 100,000 applications for its 2,900 global internships in 2021, despite well-publicized complaints from recent hires about long and unpredictable hours, and the increasing lure of tech jobs. 

Yet, a recurring concern among my students planning on working in finance is that they will become cogs in a large machine, finely tuned to maximize short-term profits by extracting value from others. How should they navigate the potential conflicts between their humanistic values and the daily demands of high-stake finance? 

The bar has been raised in terms of what an alignment of values means for students. I can see from my own undergraduate students that their interest in understanding their potential impact on society has deepened since the 2007-2008 financial crisis. For years, application essays to one of my classes on ethics in finance reflected the deep emotional impact of the recession that followed, often punctuated by a parent losing a job. 

In recent years, worries about the environment have suffused these essays. The current generation of students has grown up steeped in environmental concerns; many of them perceive climate change to be driven by human activity.

Activism is a greater part of young people’s identity than for previous generations. Even business school students, often portrayed as viscerally bottom-line oriented, are flocking to courses helping them understand their potential impact on the world. The New York Times reported that 600 Harvard Business School students registered for elective courses on social impact last year, up from 251 in 2012. 

The pandemic may have accelerated a shift in priorities toward greater social consciousness in their lives. In a recent survey of Gen Zs by EY, 39% stated they would prioritize making a difference in the world, versus 33% in the same survey pre-pandemic. Members of that generation are not only increasingly stating preferences to live their values at work, they appear poised to act. In a 2021 Deloitte global survey of Gen Zs, close to half stated that they made choices in the past two years about the type of work they are prepared to do and the organizations they are willing to work for based on their personal ethics. 

But young graduates are no wooly-headed idealists. They are quick to pressure-test assumptions and dismiss hypocrisy. They are highly resourceful digital natives, nimble at obtaining information from curated online sources. They blame baby boomers for the world that has been left to them and are unlikely to blindly trust what they hear from their firms’ senior managers. 

The finance world is responding. Its pro-social revolution is gathering steam. Assets embedding environmental, social, and governance factors in investment decisions have surged. That trend has generated vast interest among the younger generation. Yet, skepticism remains: In a CFA survey of 15,000 students, only 8% of undergraduate students believe that investment management can offer a positive social and environmental contribution. 

What can young graduates do once they start their analyst or associate finance programs to uphold their values and contribute to society?  

Some will have chosen to pick their spot in the industry to minimize any misalignment between their values and professional activities. In my view, most of finance serves society, but not all of it does. Working at Vanguard, the pioneer index fund manager, or for a community bank lending to small businesses will likely not keep anyone up at night pondering whether they are both helping their clients and contributing to society. 

Regardless of where they land, the most effective starting point to live up to personal values will not be to agitate and challenge on day one, but to acquire and master their position’s core skill-set. When young graduates suggest new initiatives within their firms or raise values-oriented concerns, nothing will provide them more credibility than internal reputation. 

They should feel emboldened by the fact that they live in an era of particular receptivity for their views. Millenials and Gen X have been credited for the explosion in demand for ESG financial products. Younger employees at mainstream financial institutions have been instrumental in driving their firms’ tilt toward these products. 

The relative inexperience of young graduates with their job and their firm offers them a unique advantage relative to their more senior colleagues: They have license to ask pesky questions and probe for transparency. An inquisitive mind will often be valued by managers as a sign of burgeoning leadership—particularly if backed by a strong core skill set, while the questions may push these managers to think more deeply about the social impact of their firm’s activities. 

In the investment world, this can translate into keeping their firm honest on ESG matters at a time when many engage in greenwashing. Holding their managers accountable on their firm’s adherence to its publicly espoused standards may be one of the most valuable services young finance professionals can do to serve their customers and society. 

Guest commentaries like this one are written by authors outside the Barron’s and MarketWatch newsroom. They reflect the perspective and opinions of the authors. Submit commentary proposals and other feedback to

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