Nordic Finance and the Good Society - Carnegie

Abstract:

The financial crisis was a watershed event that invited a rethinking of modern finance. The growth trend from previous decades was broken, the sector’s image deteriorated and a host of new regulation was introduced at the European Union and national state level. Continuing low growth, debt overhang and very low interest rates pose serious problems for existing business models. At the same time technological change and globalization pose major challenges. Questions abound. Is the financial sector effectively becoming a sector where shareholders and board members have no real commercial impact and where it is indirectly quasi nationalized? Will Apple, Google or other hi-tech player take it over? Will crowd finance undermine it? What role boards play in a new regulatory environment? Must Nordic institutions eventually end up as subsidiaries of major multinationals? Is the sector responsible for low investment, job creation and growth even in a zero-interest rate regime? Is a decline in financial sector employment inevitable?This project proposes a fresh, new look at the Nordic financial sector with a view to finding a way forward towards growth and value creation. The project will focus on business strategies and governance, but will also address policy and regulation issues. This project will take an open, multi-disciplinary approach and the goal is to give the general public access to leading research on the Danish and Nordic financial sector. The aim is to publish 12-14 papers in relevant disciplines and to prepare a comprehensive research report outlining strategic positions throughout the sector, including the competitive environment, employment potential and future business opportunities. Ultimately, Nordic finance needs to establish a new competitive platform or risk marginalization in the EU. The aim of the project is to contribute to future strategy and business policy discussions, in both the Danish and the Nordic context, but also to provide new knowledge on corporate governance and financial strategy that can create opportunities for developing new courses that contain both fields.Robert Shiller’s 2012 book, Finance and the Good Society, provided inspiration and intellectual background for this project and contains a comprehensive overview of many aspects of modern finance, but equally important it is also a firm reminder of their economic and social impact.