In this case study the authors outline how a major financial institution in the Netherlands deals with the practical aspects of implementing a Basel II‐compliant economic capital…
Abstract
In this case study the authors outline how a major financial institution in the Netherlands deals with the practical aspects of implementing a Basel II‐compliant economic capital framework. The paper gives an overview of the programme Rabobank has set on track for the implementation and discusses the prioritisation of project streams and how to track progress of the programme. An important aspect of the whole programme is communication between all the parties involved. Finally, the paper concludes with a discussion of the major challenges faced during the implementation process.
Details
Keywords
The purpose of this paper is to examine the history of the Dutch cooperative Rabobank to understand how the structure of an organisation determines how individual employees…
Abstract
Purpose
The purpose of this paper is to examine the history of the Dutch cooperative Rabobank to understand how the structure of an organisation determines how individual employees validate norms within that organisation.
Design/methodology/approach
Data over an approximately 10-year period starting 25 years ago are analysed, and the value of relating a historical analysis and narrative approach to ethical and institutional theories in economics and management science is demonstrated.
Findings
Regulation in the banking sector appears to have a strong normative aspect. The choice between state and private ownership is based on ideology. The author argues that the private ownership model was based primarily on an ideology surrounding economic efficiency, but that in fact there are other logics that also promote economic development. This contributes to the understanding of the interaction between sector standards, organisational structures and the values of organisations and individual employees. The structure of an organisation enables key employees to deviate slightly from the organisation’s prevailing norms in response to pressures from the wider environment, and those individuals thereby become symbols of that organisation.
Originality/value
The perspective on management history put forward in this paper enables assessing the distinction between normative notions in institutional environments and the organisation as a whole as represented in its governance structure and narratives that key employees disseminate about the organisation. This in turn helps us to understand the interaction between sector standards, organisational characteristics and values represented by individual employees. The author reveals the strong normative impact of banking regulation in line with an older ideological model focused on economic efficiency rather than market logics and the interests of society.