One of the sad things about the financial services industry over the years has been the unwillingness of many of its leading players to take part in public discussions over its own future.
Occasional spats do break out, warnings are given and open letters are written but, generally, most of us are none the wiser as to what a senior life company executive is telling a Government minister or an FSA armchair-warmer at the regular joint meetings they attend.
The reasons for such reticence are varied. In some cases, this is down to a reluctance to stir up a hornet’s nest in public. Senior executives prefer to do their talking privately, in the belief they can achieve more behind closed doors.
Or they are afraid of the potential consequences to their own careers if it becomes known they said something that ridicules Canary Wharf officials.
If it is the latter, one can only recommend a tactic used regularly with solid, if slightly cowardly, effect by some of those who take part in regular online debates on Money Marketing’s website – do not give your real name when commenting on something. The beauty of such a strategy is that it allows you to be offensive while protecting your anonymity.
Sadly, it is too late to help Prudential UK deputy chief executive Barry O’Dwyer, whose jokey comments sent out in an email to 2,500 of his company’s employees seemed to backfire on him last week, after they were published in the Sunday Telegraph.
My gut instinct is that O’Dwyer will now engage in a period of self-imposed purdah as he tries to overcome the embarrassment his remarks have caused within Prudential.
As it happens, I believe he has nothing to be ashamed of. He is a key figure within the industry and his views, right or wrong, are perfectly valid. It is important we know what he is saying to the FSA, as it is such debate that will ultimately affect the way we are regulated.
In that sense, for Prudential’s spokespeople to try to describe his email as “misjudged”, as they have done this week, is unfair to him and makes both the company and O’Dwyer look silly.
That said, O’Dwyer also needs to be aware that when comments are made that seem to impugn the views of people he is talking to – for example, members of the FSA consumer panel – he is potentially skating on thin ice.
O’Dwyer’s email said: “It became clear to me how much the personal prejudices of some key individuals can determine the direction of regulation. As with the treatment of legacy products on RDR, evidence sometimes seems to be overridden by prejudice.”
His email mentions the fact that the individual to whom he is referring once had a PruDirect policy he was very happy with. The FSA panel member also complimented the Pru on the quality of its service. “Yet five minutes later he came close to dismissing the whole of the with-profits industry,” O’Dwyer complained.
This raises two concerns. One is that it leaves the person concerned in danger of being identified by those who want to do a bit of detective work and, if so, he is defaming that individual by implying, without offering proof, that the person’s motives are driven by prejudice.
The second point O’Dwyer seems unaware of is that it is perfectly possible to have a with-profits policy from a reputable company, presumably bought in the early to mid-1980s when they were much more popular, and be happy with it – while at the same time being negative about with-profits policies in general.
You don’t believe me? I took out a Scottish Amicable policy in 1983, which turned into a Pru one, and it delivered perfectly respectable returns when it matured after 25 years. But I have also been extremely critical of with-profits products in general because of their heavy initial charges and in-flexibility, which made them unsuitable for all but a minority of those they were sold to.
My views are not unique among consumerists. For O’Dwyer to feign outrage at the possibility that they might be voiced by a member of the FSA consumer panel strikes me as bizarre. Is he really saying he has never heard such opinions before? If not, where has he been for the past 30 years?
There are other aspects of the email that are also self-serving, such as the attempt to ringfence existing policies from the effects of new rules on trail commission. It strikes me that the FSA has reached a messy compromise here, one that gives consumers a minor amount of leverage in their battles to achieve decent service from their IFAs.
It is nonetheless far better we know what O’Dwyer thinks than being left in the dark. At least then we can engage with, debate and test any ideas he might have. I would rather that than wonder about the identity of my own critics, including Hugh Jarse – although, for all I know, that may well be his real name.
Nic Cicutti can be contacted at firstname.lastname@example.org