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JP MORGAN CHASE: SETTING THE RIGHT CODE OF CONDUCT

Reference No. 16/007C Publication Year 2016
Author(s) Ariel Li, Heidy Tse
Company JP Morgan Chase
Industry Banks and Diversified Financials
Geographic setting Worldwide
Functional Area Strategy and General Management; Economics and Business Policy

Synopsis

As emerging Asian economies started posting rapid growth rates in the 1970s, many global banks, such as JP Morgan Chase, were attracted to the growing markets of Asia. Initially, they entered the Asian markets by setting up small offices that replicated the existing Western operating models and systems in Asia. At this early stage, it was common to see parent companies maintaining a centralized oversight on key policies and governance structures of their foreign operations, primarily for global alignment of their operations. However, over the years the global banks realized that the socio-cultural differences between East and West significantly affected the management, and of course the success, of their Asian operations.  These East-West differences were reflected not only across their core cultural values and beliefs, but also their broader social, educational and political dynamics. In the end, to manage across these cultural differences effectively, appropriate new codes of business conduct and ethics had to be developed and implemented for law-abiding as well as effective operations of global banks.

Learning Objective

Students should begin by summarizing the key challenges faced by the global banking industry when expanding to Asia.  Next, specifically discuss the strategies JP Morgan Chase used to respond to these challenges. Students should also analyze the reasons why setting, and explicitly articulating, correct Codes of Conduct is important for the success of a global bank, and how such Codes can help the firm achieve its objectives. 

 

Suggested Questions:

1. What were the key challenges that JP Morgan Chase faced when expanding to Asia?

2. How did JP Morgan Chase respond to those challenges?

3. Why was setting the correct Code of Conduct important to a global bank like JP Morgan Chase?

4. How did its new culture and conduct program enable the bank to achieve its objectives?