Conflicts of interest and governance of systemic banks: elements of critical analysis Revue d'économie financière, n°130, 2nd quarter.

Summary In this article, we define two broad categories of conflicts of interest concerning systemic banks: micro conflicts of interest that undermine the fiduciary responsibility of banks towards their clients and macro conflicts of interest that harm the interests of society as a whole and fuel social distrust of banks. The hypothesis of this article is that the repeated financial scandals that splash the large international systemic banks are not an epiphenomenon but, on the contrary, a symptom of the flaws in their governance and the unaddressed conflicts of interest that undermine them. Deciphering the permissive conditions for the relaxation of ethical standards in banking is important for financial stability, for confidence in the financial system and should have major implications for public action. We therefore advocate that economists invest in this field of research.