Accompanying a somewhat scolding and dramatic speech by Martin Wheatley was a paper from the Financial Services Authority outlining the sins of incentivised salespeople and managers and how incentives can lead to mis-selling scandals. Here are some things I noticed:

1. This is a shot across the bow

The opening salvo of the FSA report is once again like a scolding parent tutting over their misbehaving teenager: “This comes after years of warnings about managing the risks from incentives properly”. In other words, I’ve told you a million times and if you can’t handle the responsibility then you will lose the privilege, ie the car keys.

As someone relatively new to this industry, I could be mistaken in thinking this tone is something new, an attempt to establish the bad-cop/good-cop, hardline approach of the new regulator. However, it’s the same tone I found when I read through the Ucis paper from earlier this month.

Is Martin Wheatley genuinely iron-fisted? Remember, this is a man who has had his effigy burnt. Can you imagine? Do you know anyone else who can boast having made a group of people that upset?

Wheatley is sick and tired and he’s not going to take it anymore. For the paper to promise so much more heavy regulation without giving details of how it will be implemented or avoided, he may as well have whispered in our ear like that criminal temptress Catwoman: “There’s a storm coming, Mr Wayne. You and your friends better batten down the hatches, because when it hits you’re all going to wonder how you ever thought you could live so large and leave so little for the rest of us.”

In this case though I think he might mean it. The new regulator is going to rule with the stick, not the carrot.

After all, it said: “This work aligns with the FCA’s new supervisory approach of intervening earlier to reduce the underlying causes of consumer detriment.” Intervening earlier. Underlying causes. There’s a storm coming.

2. The FSA doesn’t believe incentives are intrinsically bad, or at least won’t come right out and say as much.

Here’s the thing. Sales teams have been using incentives for pretty much all of history. It’s a pretty big part of how capitalism works. As loudly as Wheatley rattles his saber about how incentives lead to mis-selling, if you read closely you see that his issue is with the fallibility of salespeople, not the bonuses themselves.

Maybe he’s stopping just short of saying bonuses cannot be paid to salespeople because of the furor it would spark. Some people are still reeling from the commission ban.

I don’t think that’s the case though. I think he’s talking about shifting the incentives to reward quality selling rather than quantity, and to - somehow - align with the customer’s interest. How companies will go about implementing this is beyond me.