Case Studies from a Woman’s Life on Wall Street

Dr. Kara Tan Bhala’s new book, Ethics in Finance: Case Studies from a Woman’s Life on Wall Street tells the story of an immigrant Asian American woman’s journey through Wall Street finance. She recounts her encounters during her career, with (common but often unacknowledged) financial ethics problems through ten short stories or case studies. Dr. Tan Bhala uses these narratives to engage the reader into learning how to evaluate and to determine resolutions to ethical issues in real life situations. The book aims to teach and to entertain. Dr. Tan Bhala makes abstract and abstruse moral philosophical concepts understandable for the reader by using plain language, in an informal style, and relating the philosophy to her experiences. The book may be obtained both as an e-book and in hard cover.

The following excerpt* comes from the Introduction, which summarizes the purpose, structure, and intended audience of the book, and also gives her reasons for writing it.

Introduction

Psssst. You, young people who want to be, or will accidentally end up, in finance, this book is mainly for you. When you enter finance, you will likely love the job, work entirely too hard, and encounter cases like the ones in this book. Ethics laden situations require ethics reasoning and tools. I wrote these cases as a record of my career but also as a way to help you, the future, to build a more ethical and socially responsible finan- cial industry. Many of you will work in international finance and across diverse financial fields. To that end, this book is international in scope and covers a broad segment of the financial services industry. The case studies span across regions from a plantation in Malaysia, a hot social scene in Thailand, Christmas parties in New York, to suburban offices and college towns in the US heartland. The industries range over a swathe of finan- cial services: securities brokers, large asset managers, hedge funds, small mutual fund companies, and the finance academy.

I also wished to provide financial ethics guidance to the general public, including finance practitioners, policy makers, and regulators and to assure them human beings are morally educable. I try to do this through what I hope are engaging stories. The case studies form a narrative chain that represents a woman’s journey through her career, inspired by Homer’s Odysseus and his twenty years of (far more enthralling) travels after the Trojan Wars. Each case study starts with a story. Following the narra- tive, I highlight the prominent ethics issue in the case. For example, in Chapter 6 the ethics issue is quite clear: should a person engage in insider trading? I give reasons why insider trading has ethical implications. The section, “Ethics Analysis”, then goes into details on the ethics tools the reader can use to analyze the issue. So, for example, using standard ethics frameworks, such as utilitarianism, we derive reasons why insider trading is wrong. The ethics analysis is followed by suggestions on how to resolve the problem and the best action to take. In sum, every chapter is an ethics training guide using case studies.

When I inform people I run a not-for-profit think tank that does research, education and promotion of financial ethics, invariably the first skeptical response is, “Isn’t financial ethics an oxymoron?” After a weary answer of “No, it’s not an oxymoron, it’s a necessity for the long-term proper functioning of finance and society”, the next question usually goes, “But you can’t teach ethics, can you?” That’s when I get slightly more aggressive and say, “Well, should I have allowed my daughter to grow up feral then?” Meaning, do you as a parent, not teach your children how to behave well and about what is right and wrong, which by the way, constitutes the broad definition of ethics? If you do teach your children morality, then yes, ethics can be taught. This argument then elicits the riposte, “Well, you cannot teach ethics to adults, especially those already in the financial services workplace.” My rejoinder at this point is “Why the arbitrary cut-off at 18 for an inability to learn how to be ethical? Why not 32 or 54? We find no problem teaching adults a bunch of other non- quantitative, values infused subjects like religion, all forms of aesthetics like poetry and art, and, of course, self-help, and yet our ability to learn how to be ethical stops at the age of 18?” That’s roughly a summary of my first day at a seminar where I give a lecture on financial ethics. I write this book partly to demonstrate financial ethics can be taught.

What should you take out of this book? First, don’t seek perfection in the practice of ethics. Ethics is not a science with absolute right answers. Indeed, scientism has contributed to the decline of ethics education. In an age of science, people expect scientific-like demonstrations of reliability to solve important problems. Yet, the methods of science and the methods of ethics are different. Science uses the empirical method that involves exper- imentation and observation. The researcher gets data to support or refute a theory. Even though ethics does not use the scientific method it is no less rigorous. The method of ethics is discursive which means to proceed by argument and reason. The discursive method can be generalized as follows:

(1) Give reasons to support a proposition about an act being right or wrong.

(2) Analyze arguments.

(3) Justify principles.

In the end, there may be good reasons to support an argument, but it may be difficult to persuade some people to agree with the conclusion. Most arguments are unlikely to receive unanimous agreement but it is particularly vexing when the examples given to support that ‘proof’ in ethics is impossible are the ones involving supremely difficult moral issues such as abortion or euthanasia. In practice, ethical issues are far more quotidian and uncomplicated. Aristotle understood the decision on the choice of a right act depends on the situation. A person needs to use reason and analytical tools to come up with the best ethical choice in that situation. Just because we cannot be perfect in every decision involving an ethical issue does not mean we should give up trying to think about and then to do the right thing. We are called to try our best, but we are not expected to be right all the time. This book aims to be your guide in ethical thinking so your acts are ethical, as far as you can try.

Hopefully, you will be assigned the book in your business school classes. Maybe you will read this volume in your mandatory business ethics class (probably the only one you will have in your entire business major or MBA program). My backup plan if this book is not assigned by a multi- tude of college professors is to sell the rights to Netflix. The streaming giant will then produce a bingeable ten-episode series, which will subse- quently rocket me into the ranks of the one percent. I was figuring Lucy Liu would play me. In the award-winning NBC comedy, The Good Place, Chidi Anagonye is a main character who is a professor of philosophy. In each episode, he teaches his friends some ethics theory so they can become good. And they do! So, just as The Good Place popularizes ethics, this book (and its film version, maybe) will, with luck, popularize financial ethics.

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If you wish to review the book, please write to kara@sevenpillarsinstitute.org, giving your name and affiliation, to obtain a reviewer’s copy.

The book is also available on Amazon in kindle and hardcover formats.

* Kara Tan Bhala, Ethics in Finance: Case Studies from a Woman’s Life on Wall Street, (Cham, Switzerland: Palgrave Macmillan, 2021)