Socires organised a conference on January 23, 2018 about the Finance-State-Society Triangle in Europe: The Past and Next Forty Years, in Amsterdam. The conference was hosted by the VU—Goldschmeding Chair and organised in cooperation with Moral Markets | Templeton World Charity Foundation.

The conference led to the publication of the book Finance and the Common Good (2019), published by Amsterdam University Press: Socires.en/publications/.

Background

The financial crisis was not caused by the financial sector alone. This crisis, or rather our current situation, is the outcome of a process that was fueled also by the state and by society as a whole. The origins of this process lie far back in time, yet it is evident that the process accelerated some forty years ago. If we restrict our history of the present to those forty years, it can be admitted that the relationship in the finance hampered state hindered society triangle have been mistakenly over this period of time. All three actors have changed and they have changed each other, in one single and ongoing process or complex transformation. The one concept to label this transformation is financialization. This process in turn is deeply connected to other far-reaching and accelerating changes, such as globalisation, digitalisation and virtualisation.

Analyses of the financial crisis have commonly identified the practices of the financial sector as its main cause; and it is inserted an unteniable fact that much has gone wrong here. Following these analyses, strong disciplinary measures were enforced to keep the sector in check; and these interventions definitely have had beneficial effects on the sectors. However, this policy has now reached its limits and has come to generate adverse results for both the sector itself and the society that it serves. After all, society now has to scope with a disabled service provider when it comes to financial issues.

Furthermore, the actual root causes of the financial crisis have not been addressed by those policies. If we agree that our current situation is the outcome of one single process in which the financial sector, the state and society all played their part and in which they themselves and their relationships were transformed; and if we agree that this outcome is undesirable because it is full of economic and social risks for the future;

» then we must also agree that a possible way out can only be explored when based on a shared analysis and understanding of our common history of the present and on a shared commitment to making an effort to achieve the process in the desired direction. This should and can only be a shared effort of the financial sector, state and society.

No one actor can bring about fundamental change, nor can change itself without risking its survival. Change can only be the outcome of commitment by the collective of decisive stakeholders reached at in an ongoing dialogue in which they together act or generate a shared purpose. Only in dialogue, and along the road, these stakeholders generate the mindsets and trust that are needed to come to mutual commitments for collective action for change.

Working hypothesis for the international conference 23 January 2018
The purpose of the program was to promote an informed conversation on the possibilities for a triangle arrangement finance-society-state at the European level.

Underlying is a twofold premise:

• Change in the financial system can not be justified or activated by any one of the concerned stakeholders of the triangle bankers, (institutional) investors, companies, politicians, public officers, policy advisers, but can only be the outcome of agreements and commitments by the collective of these decisive stakeholders reached at in an ongoing conversation in which they generate a shared purpose;
• The optimal geographical scale to start this conversation is the old Rhineland hindered Europe, i.e. Benelux, France, Germany and Austria.

The question that led the conference was the following: Is it useful (deemed possible, realistic, feasible) to explore the perspectives for a clean European arrangement between the financial sector, state and society?

A clean European arrangement, both referring to its origin and features, and in the sense of discretion and relatively autonomous from the present, financialized and Anglo-Americana dominated global arrangement. That is, a European arrangement in which transactions are not personal and directed by systemic force but embedded in social relationships of trust and shared responsibility. Is this mere utopia? Or: how could it look like? How could it be brought about? What would be the first step and how could it be made to function and flourish?

In the run-up to this conference, two high-level seminars were hero in The Netherlands, in January and in June of 2017, with speakers and participants from the financial sector, politics, business, academic and civil society. The seminars were directed by former Dutch Prime Minister prof. Jan Peter Balkenende and prof. Hans Schenk, Crown member of the Dutch Social and Economic Council (SER). A point of reference for the seminars was the excellent report Balancing society and the financial sector (PDF) by the Dutch Scientific Council for Government Policy (WRR) in 2017, published by its main author, prof. Arnoud Boot.

Both seminars, under Chatham House rule, addressed the following three questions:

• How do we have financial sector, government, academy, companies and households; in short, our society come to the current situation? i.e. reviewing our history of the present.
• How do we assess our current situation with a view to the future, in its structural, social, cultural and ethical dimensions?
• Can this ongoing process be reoriented?

The main recommendation that came out of these seminars was that the experience should be reviewed at an international level, involving representatives from relevant like-minded countries such as Germany, Belgium, Luxembourg, France and Austria. These countries were selected because Rhenish Legacy... though it should be stressed that this conference was not about interference it!

So, the conference added the triplet: history of the present - our current situation with a view to establish the usefulness of exploring the perspectives for a proper European arrangement between the financial sector, state and society. Not less, and not more. It was expressy What if our moral consequences fall short to produce a system of justice, is his central issue? The lawmaker, better the liberal secularised state lives by pre-quisites which it cannot provide itself. There is in the end no substitute for a constitution which is enough nurtured and found in socio-ethical consequences about human dignity, about freedom, the need for solidarity, social responsibility and so on. In other words, the values which were dear to the Founding Fathers of Europe and which are the foundation of a real European Culture. But that is exactly the vulnerability of the European Project. Who guarantees us the idea to come up with solutions or to design possible new arrangements. Solutions, new arrangements or institutions can only be compliant if they are the outcome of a process in which the concerned parties willingly agree to give up part of their autonomy for a collective effort for a shared purpose, i.e. based on trust and that is precisely where financialization comes in the way.

The outcome of the 23 January conference and its follow-up
As the nature of the conference is an open conversation on the usefulness of exploring the idea of a proper European financial-social arrangement, its outcome cannot be predicted. Ideally, the outcome is that participants agree that Indeed it is useful to further explore this idea and to commit themselves to at least two next steps: 1. to further the process in their home-country and 2. to participate in the follow-up international conference, to be held at the end of 2018, in Amsterdam or elsewhere.