At this time of year, at graduation ceremonies in America and elsewhere, those aboutto leave university often hear some final words of advice before receivingtheir diplomas. To those interested inpursuing careers in finance – or related careers in insurance, accounting,auditing, law, or corporate management – I submit the following address:

Best of luck to you as you leave the academyfor your chosen professions in finance. Over the course of your careers, WallStreet and its kindred institutions willneed you. Your training in financial theory, economics, mathematics, andstatistics will serve you well. But your lessons in history, philosophy, andliterature will be just as important, because it is vital not only that youhave the right tools, but also that you never losesight of the purposes and overriding social goals of finance.

Unless you have been studying at the bottom of the ocean, you know thatthe financial sector has come under severe criticism – much of it justified –for thrusting the world economy into itsworst crisis since the Great Depression. And you need only check in with some of your classmates who have populated the Occupy movements around the world tosense the widespread resentment of financiers and the top 1% of income earners towhom they largely cater (and often belong).

While some of this criticism may be over-stated or misplaced, it nonetheless underscores the need to reformfinancial institutions and practices. Finance has long been central to thrivingmarket democracies, which is why its current problems need to be addressed.With your improved sense of our interconnectedness and diverse needs, you cando that. Indeed, it is the real professional challenge ahead of you, and youshould embrace it as an opportunity.

Young finance professionals need to familiarizethemselves with the history of banking, and recognize that it is at its best whenit serves ever-broadening spheres of society. Here, the savings-bank movement in the United Kingdom and Europe in the nineteenthcentury, and the microfinance movementpioneered by the Grameen Bank in Bangladeshin the twentieth century, comes to mind.Today, the best way forward is to update financial and communicationstechnology to offer a full array ofenlightened banking services to the lower middle class and the poor.

Graduates going into mortgage banking are faced with a different, butequally vital, challenge: to design new, more flexible loans that will betterhelp homeowners to weather the kind ofeconomic turbulence that has buried millions of people today in debt.

Young investment bankers, for their part, have a great opportunity todevise more participatory forms of venturecapital – embodied in the new crowd-funding Web sites – to spur the growth ofinnovative new small businesses. Meanwhile, opportunities will abound for rookieinsurance professionals to devise new ways to hedgerisks that real people worry about, and that really matter – thoseinvolving their jobs, livelihoods, and home values.

Beyond investment banks and brokerage houses,modern finance has a public and governmental dimension, which clearly needsreinventing in the wake of the recent financial crisis. Setting the rules ofthe game for a robust, socially useful financial sector has never been more important. Recent graduates are needed inlegislative and administrative agencies to analyze the legal infrastructure offinance, and regulate it so that it produces the greatest results for society.

A new generation of political leaders needs to understand the importanceof financial literacy and find ways to supply citizens with the legal andfinancial advice that they need. Meanwhile, economic policymakers face thegreat challenge of designing new financial institutions, such as pensionsystems and public entitlements based on the solidgrounding of intergenerational risk-sharing.

Those of you deciding to pursue careers as economists and finance scholarsneed to develop a better understanding of asset bubbles – and better ways tocommunicate this understanding to the finance profession and to the public. Asmuch as Wall Street had a hand in the current crisis, it began as a broadly held belief that housing prices could notfall – a belief that fueled a full-blownsocial contagion. Learning how to spot such bubbles and deal with them beforethey infect entire economies will be a major challenge for the next generationof finance scholars.

Equipped with sophisticated financial ideas ranging from the capital asset pricing model to intricate options-pricingformulas, you are certainly and justifiably interested in buildingmaterially rewarding careers. There is no shame in this, and your financialsuccess will reflect to a large degree your effectiveness in producing strongresults for the firms that employ you. But, however imperceptibly,the rewards for success on Wall Street, and in finance more generally, arechanging, just as the definition of finance must change if is to reclaim its stature in society and the trust of citizens andleaders.

Finance, at its best, does not merely manage risk, but also acts as the steward of society’s assets and an advocate of itsdeepest goals. Beyond compensation, the next generation of finance professionalswill be paid its truest rewards in the satisfaction that comes with the gainsmade in democratizing finance – extending its benefits into corners of societywhere they are most needed. This is a new challenge for a new generation, andwill require all of the imagination and skill that you can bring to bear.

Good luck in reinventing finance. The world needs you to succeed.