A 'profoundly amoral culture' is harming global financial systems, the Vatican is warning.
A document, released by a Vatican body on Thursday with the approval of Pope Francis heavily criticises tax avoidance, the use of offshore and exploiting others to make profit. It calls for a worldwide financial system to regulate markets to stop what it described as 'a dangerous oligopoly on the part of a few'.
The text was released by the Congregation for the Doctrine of the Faith and the Dicastery for Promoting Integral Human Development.
It criticises businesses' sole focus on producing profit for shareholders and says companies should also serve the interests of their local community and customers.
'Moreover, where massive deregulation is practised, the evident result is a regulatory and institutional vacuum that creates space not only for moral risk and embezzlement, but also for the rise of the irrational exuberance of the markets, followed first by speculative bubbles, and then by sudden, destructive collapse and systemic crises,' it says.
The document, entitled Oeconomicae et pecuniariae quaestiones: considerations for ethical discernment about some aspects of the current financial-economic system criticises large bonuses without subsequent punishments when a company does badly.
'All of these factors easily create and diffuse a profoundly amoral culture – in which one often does not hesitate to commit a crime when the foreseen benefits exceed the expected penalty,' it states. 'Such behaviour gravely pollutes the health of every economic-social system. It endangers the functionality and seriously harms the effective realisation of that common good, upon which is necessarily founded every form of social institution.'
The Vatican also attacked tax avoidance and said even if a minimum amount of tax was paid on all transactions, world hunger would be largely solved.
'It was calculated that a minimum tax on the transactions accomplished offshore would be sufficient to resolve a large part of the problem of hunger in the world,' the text states.
'Furthermore, it has been established that the existence of offshore sites has encouraged also an enormous outflow of capital from many countries of low income, thus creating numerous political and economic crises, impeding them from finally undertaking the path of growth and a healthy development.'
