Fast and Fair Blind Peer-Reviewed with Hybrid Access Scholar & Practical Journals

# # #

Prospective Innovation at Ethical Banking and Finance

Vol:0, №:0, Year:2013

The ethical banks in Europe during the crisis: information transparency and placement of assets

SAN-JOSE LEIRE
Financial Economics II. ECRI Ethics in Finance & Governance - UNIVERSITY OF THE BASQUE COUNTRY (SPAIN) AND UNIVERSITY OF HUDDERSFIELD (UK)
Spain

RETOLAZA JOSE LUIS
Financial Economics II. IEAE - UNIVERSITY OF THE BASQUE COUNTRY
Spain

BOCANEGRA DAYLI
FINANCIAL ECONOMICS II - UNIVERSITY OF THE BASQUE COUNTRY
Spain

Abstract
The financial crisis has increased the importance of the transparency in banking because of the relevance to invest the money of savers and the effect of a risky investment. There are some banks, called Ethical Banks that show in a transparent way the collocation of their money. Then, this research analyses the principal differences between ethical banking and the rest of funding organization: the information transparency and collocation of asset comparing before and during the crisis (2007 vs. 2011 data) and using the European Ethical Banks data. There is an index, RAI (Radical Affinity Index) that integrates this information; therefore, we have used a part of the index, the RAI alpha to show the transparency and placement of assets as the most important factors of ethical banking to resist the negative effect of the actual financial crisis.

References

Alchian, A., Demsetz, H. 1973 “The property rights paradigm”, Journal of Economic History, Vol. 33, pp. 16-27.

Alsina, O. 2002, La banca ética. Mucho más que dinero, Barcelona: Icaria Milenrama.

Azkunaga, A., San-Jose, L., Urionabarrenetxea, S. 2013 “The impact of Financial Globalization and Financialisation of the Economy in current crisis through the Banking Corporate Governance”, Contemporary Economics, Vol. 7, No. 3.

Baranes, A. 2009 “Towards Sustainable and Ethical Finance”, Development, Vol. 52, No. 3, pp. 416-420.

Barbu, T., Vintilã, G. 2007 “The Emergence of Ethic Banks and Social Responsibility in Financing Local Development”, Theoretical and Applied Economics, Vol., pp. 20-34.

Boatright, J.R. 2002 “Contractors as stakeholders: Reconciling stakeholders theory with the nexus-of-contracts firm”, Journal of Banking and Finance, Vol. 26, pp. 1837-1852.

Bravo, R., Matute, J., Pina, J.M. 2012 “Corporate Social Responsibility as a Vehicle to Reveal the Corporate Identity: A Study Focused on the Websites of Spanish Financial Entities”, Journal of Business Ethics, Vol. 107, No. 2, pp. 129-146.

Buttle, M. 2008 “Diverse economies and the negotiations and practices of ethical finance: the case of Charity Bank”, Environment and Planning, No. 40, pp. 2097-2113.

Castro, M., Romero, N. 2011 “Banca ética y Cooperativas de Crédito, CIRIEC, No. 72, pp. 269-272.

Coase, R. 1960 “The problem of social cost,” Journal of Law and Economics,Vol. 3, pp. l-44.

Cortes, F.J. 2009, Finanzas éticas: banca ética, microfinanzas y monedas sociales, Madrid: Hidra de Lerna.

Couplan, C. 2006 “Corporate social and environmental responsibility in web-based reports: Currency in the banking sector?”, Critical Perspectives on Accounting, Vol. 17, pp. 865-881.

Cowton, C. 1998 “The use of secondary data in business ethics research”, Journal of Business Ethics, Vol. 17, No. 4, pp. 423-434.

Cowton, C. 2002 “Integrity, responsibility and affinity: three aspects of ethics in banking”, Business Ethics: A European Review, Vol. 11, No. 4, pp. 393-400.

Cowton, C. 2010 ‘Banking’ in Boatright, J. (Ed.), Finance Ethics: Critical Issues in Financial Theory and Practice, Kolb Series in Finance, New Jersey: Wiley.

Cowton, C., Thompson, P. 1999, Ethical bank: Progress and Prospects, London: Financial Times Business.

Davies, H. 2001 “Ethics in regulation”, Business Ethics: a European Review, Vol. 10, No. 4, pp. 280-287.

Edery, Y. 2006 “Ethical developments in finance: Implications for charities and social enterprise”, Social Enterprise Journal, Vol. 2, No. 1, pp. 82-100.

IMF 1998, Financial crises: characteristics and Indicators of Vulnerability, IMF World Economic Outlook, cap. 4, Washington, D.C.: International Monetary Fund.

IMF 2006, How Do Financial Systems Affect Economic Cycles? IMF World Economic Outlook, cap.4, Washington, D.C.: International Monetary Fund.

Kendric, F. 2004 “Ethical banking”, ABA Banking Journal, Vol. 96, No. 6, p. 14.

Laeven, L., Levine, R. 2009 “Bank governance, regulation and risk taking”, Journal of Financial Economics, Vol. 93, No. 2, pp. 259–275.

Lang, W., Jagtiani, J. A. 2010 “The mortgage and financial crises: The role of credit risk management and corporate governance”, Atlantic Economic Journal, Vol. 38, No. 2, pp. 123-144.

Lynch, J.J. 1991, Ethical Banking: surviving in a age of Default, London: Macmillan.

Peterson, R, Hermans, C. 2004 “The Communication of Social Responsibility by US Banks”, The International of Bank Marketing, Vol. 22, No. 3, pp. 145-199.

Purnanandan, A. 2010 “Originate-to-Distribute Model and the Subprime Mortgage Crisis”, Review of Financial Studies, Vol. 24, No. 9, pp. 1.881-1.915.

San Emeterio, J., Retolaza, A. 2003 “¿Existe espacio para una banca ética?”, Lan Harremanak, Vol. 2, No. 9, pp. 127-163.

San-Jose, L., Retolaza, J.L. 2008 “Information transparency as differentiation factor of ethical banking in Europe: Radical Affinity Index approach”, The ICFAI Journal of Bank Management, Vol. 7, No. 3, pp. 7-22.

San-Jose, L., Retolaza, J.L., Gutierrez-Goiri, J. 2011 “Are Ethical Banks Different? A Comparative Analysis Using the Radical Affinity Index”, Journal of Business Ethics, Vol. 100, No. 1, pp. 151–173.

Torres, J.; Retolaza, J.L., San-Jose, L. 2012 “Gobernanza multifiduciaria de stakeholders: análisis comparado de la eficiencia de bancos y cajas de ahorros”, REVESCO, No. 108, pp. 152-172.




Key words
ethical banking, index, transparency, quality of assets, financial crisis.

Citation
Leire San-Jose, Jose Luis Retolaza and Dayli Bocanegra (2013), The ethical banks in Europe during the crisis: information transparency and placement of assets in Leire San-Jose, Jose Luis Retolaza (eds.) Prospective Innovation at Ethical Banking and Finance (Studies in Philosophy, Law and Economics), - Sumy: Vinnychenko M.D., pp. 20-38. Available at http://taadler.com/a42

Preview or read without downloading