• Disclosure and Transparency (principle 4)
• Responsible Business Conduct of Financial Services Providers and their Authorised Agents (principle 6)
• Complaints Handling and Redress (principle 9)

It is an interesting read and it is clear that the member countries in the task force have the best interest of consumers at heart. It is also noticeable that the interests of employees have been kept in mind. For example, the responsibility for ensuring good sales practices, continuous competence development and accountability all point back to the company level.

However, good can always be tweaked slightly better so I took the opportunity to share some of our thoughts and experiences with the task force members.

In relation to principle 6 we can all agree that customers need to feel secure in a sales situation. To then present the “structure of remuneration at company level on which sales staff are remunerated” to consumers is fair enough. Openness is good and it can further contribute to better business management.

But it needs to be ensured that remuneration transparency is kept at a sufficiently general level. Providing the customer with the exact amount of the variable remuneration received by the individual employee does not contribute to consumer protection, instead it risks having a confusing and obscuring effect and divert the customer’s attention away from what should be the real focus in sales situation: the price and content of the product. It also risks undermining the legitimacy of collective agreements. The employees’ privacy must not be violated: how an employee is paid, by fixed or variable remuneration, is an issue for the employer, the employee and her/his trade union. Conflicts of interest are best mitigated by addressing the issue of excessive sales targets and pressure, not by breaching the personal integrity of individual employees with regard to the pay that they receive.

Consumers have the right to get good advice and employees have the right to give good advice.

What we see as the main problem when it comes to ensuring that consumers receive good and fair advice are excessive sales targets. When we asked our members in the sales and advice survey last year to evaluate how much time that is spent on advice versus sales, some even reported as low as 20% on advice. Our members are under strong pressure to sell and the horror stories seem to be endless.

The situation seems to have worsened since the financial crisis: the banks wanting to keep up the profits at the same time as the customers have less money to invest. Aggressive sales strategies are upsetting consumers and so we are getting more reports about a hostile working environment with numerous cases of receiving threats. This is a health and safety concern that needs to be taken seriously.

It is not all about the employees though. We also need to focus on increasing financial awareness among consumers. In Denmark the national consumer organisation and FSU-DK have worked together on this. Through a board established by the Danish Parliament, aiming to raise awareness on financial matters among consumers, they have developed a range of teaching material to give young people a better understanding of personal finance. It had been shown that financial awareness in this group was very low and that many young adults already have consumer loans.

Initiatives like these are important because informed consumers make for better clients. When clients provide misinformation and thus are sold the wrong product this can lead to problems for the employees, and we want to avoid sanctions being put on individuals.

The feedback received after my intervention was positive and several task force members said that they now saw consumer financial protection from a different angle. It is clear that we have to continue to play a role in this type of setting to reach as broad a recognition of our concerns as possible.

Hanna Sjölund, UNI/NFU Policy Officer