Gifts, Corporate Policies, and Individual Morality in UK’s Alternative Real Estate Lending Market

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AbstractGifts, gratuities, and hospitality are commonplace in industry and more so in the financial sector. They are often offered without any mention of their intention. However, they raise controversial and non-detectable reciprocity expectations. We investigate brokers and lenders in the UK’s alternative real estate lending sector. Unlike the rest of the financial market, the alternative real estate lending sector is on a rapid growth path and at the same time broadly unregulated, thereby providing a breeding ground for transactional graft. This is the first analysis of gift-related behaviour in this sector. Based on an online survey of 108 professionals, we identify their corporate gift policies and gather their views on what they believe these policies should be when it comes to monetary limits. We contrast these reports with the hypothetical choices these professionals make in personalized and isolated scenarios to assess their individual moral cut-offs. For the moral value consistent subjects (comprising 72% of the surveyed population) who report a single cut-off of monetary limits below which they accept gifts but above which they do not, we find that their monetary acceptance limits have no connection either with the policies of the corporations that they belong to or with their views about what such policies should be. This suggests that employees’ views about policies in their corporations are merely social constructs for their measure of morality which is different from the same measure of their individual morality when applied in isolation. This research informs policy and corporate decision-making to promote the impact of nudging on the role of an individual as an identity in an act of perceived graft rather than simply as a member of an organization.