A Finance Reconsidered Proposal

Finance Reconsidered

publication date 5 / 12 / 2016

Christophe REVELLI

Directeur du MSc Finance

Investors must take into account the societal impact of their financing decisions.

The flow of goods and services is concurrent with the arrival of humans. We are part of a system of debts and we respond to it in different ways. Whether in the form of gifts from which nothing is expected in return, reciprocal exchanges aimed at building and strengthening social ties; the first non-commercial exchanges characterised by the fact that neither price nor value were the first criterion of the exchange, a bit like the case of fair trade today, then commercial exchanges such as large Champagne fairs and, finally, the appearance of the first markets to reach the point of capitalist commercial exchanges that dominate our world today. The latter have the distinguishing feature of only working if there is a creation of shareholder value, meaning a value that can be evaluated and exchanged on a market, which we call financial markets.

In our world, the development of these exchanges, of projects, involves financing them, meaning assigning resources to actions and means. The stock exchange has this role, offering people, savers, pension funds, businesses with liquid assets, projects that will enable them to add value, that is to say increase the value of their contributions. This investment action is delegated to third parties. Today, it is necessary, not to increase the financial value of assets but rather, to better take into account their social usefulness and their impact in respect to the challenges that our world, and therefore its inhabitants, are facing.

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