Financial industry often employs untrustworthy employees | Matthias Heinz & Matthias Sutter


Scientists identify one possible reason for the many scandals in the world of finance: Employees in this industry are often less trustworthy and less socially aware.

Whether Cum-Ex businesses or Wirecard – at regular intervals a scandal shakes the financial industry. The already shaken image sinks after each new revelation and customers, politics and society increasingly lose confidence. Matthias Heinz and Matthias Sutter, both economists of the ECONtribute Cluster of Excellence: Markets & Public Policy of the Universities of Cologne and Bonn, together with Heiner Schumacher (KU Leuven) and Andrej Gill (University of Mainz) have found a possible reason for the scandals in the financial sector: In an experimental study, they measured the trustworthiness of students and found that the least trustworthy ones work increasingly in the financial industry later on.

To this end, the researchers conducted a long-term study with students of economics at the Goethe University in Frankfurt. In a first wave in 2013, they asked 265 students about their career aspirations, social preferences and personality traits. In addition, they tested how trustworthy the students are in a computer-supported laboratory experiment, a so-called trust game. The students received eight Euros and were able to give a second person an amount between 0 and 8 Euros. The amount was then tripled by the researchers and the second person could then decide how much to give back to the first person.  People who returned a higher amount were considered more trustworthy than others, resulting in students who planned their careers in the financial world being 30 percent less trustworthy than those who planned their careers in another industry after graduation. In 2019 and 2020, the research team repeated the survey and found that the less trustworthy people had actually taken a job in the financial world.

Trust is particularly important in the financial world – and is the basis for a business relationship between customers and consultants. If consultants exploit the trust placed in them by being better able to assess the complex information available to them in the financial world than their clients, this can lead to misconduct on the part of financial employees. This in turn can become a source of scandals and fraud. The financial world could counteract this by weeding out the less trustworthy employees when they are hired – but research suggests otherwise:

“Students who want to work in the highly competitive financial world are less trustworthy than those who want to work in other industries. However, the financial world does not seem to weed out less trustworthy people during a hiring process, but actually hire them. In addition, only four percent of employees move from finance to another industry, which makes the selection of employees particularly important,” explains Matthias Heinz, Professor at ECONtribute: Markets & Public Policy and at the University of Cologne the results. Further research is needed to understand hiring processes in the financial world and derive implications for policy, the team of researchers summarizes.

Press contact

Katrin Tholen


Content contact

Prof. Dr. Matthias Sutter
Max Planck Institute for the Study of Public Goods Bonn

Prof. Dr. Matthias Heinz
University of Cologne