Description
How could it go so wrong when an intention was to develop “the local community of the future”? In 2007, the ebh-foundation was a local benefactor contributing to numerous projects aiming at securing workplaces, youngsters, doctors, thriving associations etc. in a Danish left-behind area. The year after, the foundation and the demutualized savings bank it was inseparable from had become infamous as an image of greedy bankers’ immoral and high-risk banking practices. Both went bankrupt in the financial crisis with huge debts. Thus, the role as the local “gate of possibilities” and intentions of doing business in the public interest remained only as bitter-sweet memories.In the paper, I use a case study of ebh to discuss what in the corporate philanthropy literature has been called the profit-altruism question. Concretely, I show how even in this extreme case the intentions of working for the common good cannot just be written off as deception or social-washing. Instead, ebh’s dual identity as risk-taking fast-growing niche bank and local benefactor had historical roots in a tension between cognitive frames emphasising nonprofit aims and growth respectively, in an unclear legislative framework, and in a traditional way of organizing based on high trust between locals. The board members were trusted locals with local rather than financial knowledge.
With outset in Jens Beckert’s definition of fields as reciprocal influences between cognitive frames, social networks, and institutions, I interpret the problems in ebh as caused by a merger of fields. On the one hand, an old ‘savings bank field’ based on local networks, legislation emphasising risk-averse banking, and a perception of savings banks as philanthropic gift-giving organisations. On the other hand, a ‘neoliberal banking field’ characterized by deregulation, innovative bank managers, and a survival of the fittest narrative emphasising growth and profit.
| Period | 14 Mar 2024 → 16 Mar 2024 |
|---|---|
| Event title | The Business History Conference 2024: Doing Business in the Public Interest |
| Event type | Conference |
| Organiser | The Business History Conference |
| Location | Providence, United States, Rhode IslandShow on map |