The Consumers' Association has issued “10 commandments” in a bid to improve corporate governance and business ethics.
The commandments include advice on disclosure of information, responsible practices and relationships with consumers.
The CA's corporate governance code for the industry looks at setting out remuneration strategies to steer the industry away from commission and to put consumers at the forefront of business decisions. The commission culture is seen as one of the biggest hurdles for the CA to overcome.
Ideally, the CA would like the FSA to make a rule preventing remuneration strategies but it is looking at a model where companies can voluntarily adopt the model where staff are rewarded according to overall financial and corporate performance and not by volumes of sales.
The CA is consulting with the industry, with a view to finalising issues by early 2005. Senior policy adviser Mick McAteer says: “If there is enough interest we will go for accreditation but if firms are reluctant, we will use the rules as a template to expose bad practice. But there is no choice for firms – this is going to happen and they would be better off playing ball.”