Feeding before moral!
If you type in “losers of the financial crisis” at google.com you will find many articles about all kinds of different losers that have suffered due to the crisis. There are the poor millionaires who lost half their fortune, women who feel discriminated by the new stimulus package of Barack Obama, bank chairmen who were used to bonus payments in the amount of millions and got now laid back or even arrested by the Public Prosecution Service and even the nannies and personal yoga coaches who are on the top of everybody’s cross-off list had to fear for their jobs. The situation is still strained, even four years after the big meltdown.
Everybody knows the feeling of uncertainty if an appointment for a professional finance advice is scheduled. This uncertainty increased extremely due to the financial crisis. Questions like: ”Do I really get a customer-oriented advice?”,- “Is this product the right choice for me?”, and “Are there no hidden risks?” are familiar to all of us. These thoughts are justified because one of the consequences of the banking crisis was that many banks are now depending on the support of the state which leads to rising pressure within the banks. Due to this, the employees get pressurized to observe their required goal which then leads to non-customer-oriented advice.
Table of Contents
1. Introduction to the Financial Crisis and Ethical Pressure
2. Regulatory Reactions and Their Limitations
2.1. The Introduction of the Sales Sheet
2.2. Monitoring Through "Fake Customers"
2.3. The Inefficiency of Statutory Consulting Protocols
3. Internal Bank Dynamics and Employee Pressure
4. Impact on Investors and Case Studies
5. Conclusion and Future Perspectives
Objectives and Topics
This essay explores the ethical dilemmas faced by bank employees in the aftermath of the financial crisis and examines how internal performance pressure negatively impacts the quality of financial advice provided to investors.
- The influence of institutional pressure on professional banking ethics.
- The effectiveness of regulatory tools like sales sheets and consulting protocols.
- Internal bank dynamics, including performance management and employee stress.
- Consequences of poor financial advice for vulnerable investor groups, particularly seniors.
- The conflict between profit maximization and customer-oriented consultancy.
Excerpt from the Book
The impact of internal banking pressure on employees
Like I mentioned in my introduction, many banks are depending on the support of the state after the financial meltdown, inter alia the “Commerzbank”. One of my fellow students has been working at this bank for several years, and therefore experienced the increasing pressure after the banking crisis. Many investors lost their jobs or half their fortune and so it was not very surprising that people got more cautious. A conclusion of a contract got very rare. But especially now it was important for the Commerzbank to sell products to stay in business. Since then the pressure upon the employees has been rising intensely. A weekly meeting with the branch manager is forthcoming every Friday afternoon. This meeting, so I was told, is not a conversation; it is more like a pure justification about why the given targets have not been reached the past week. In addition to that the banker has to present the revenue planning for the upcoming week and explain in which way the returns that have not been reached this week will be compensated. The anxiety of Fridays rose up to the point that my fellow student woke up drenched in sweat every Friday - being afraid to go to work. Obviously, the pressure influences increasingly the psyche of the employees.
If no earnings were achieved by Friday morning, out of desperation, some bankers picked up the phone and called the so-called “Yes-Man” investors to advise them to purchase or sell a random stock or Fund before the weekend starts. This way the employee was at least able to enter a few revenues.
Summary of Chapters
1. Introduction to the Financial Crisis and Ethical Pressure: This chapter introduces the context of the post-financial crisis landscape, highlighting the atmosphere of uncertainty and the resulting ethical tension regarding customer-oriented advice.
2. Regulatory Reactions and Their Limitations: This section evaluates measures like sales sheets, "fake customer" testing, and consulting protocols, arguing that they often fail to ensure high-quality, honest advice.
3. Internal Bank Dynamics and Employee Pressure: This chapter analyzes the high-pressure environment within banks, where employees are driven by strict sales targets to the detriment of their own well-being and professional integrity.
4. Impact on Investors and Case Studies: This part examines the real-world consequences of poor financial advice, focusing on how seniors and other investors are misled by unsustainable products.
5. Conclusion and Future Perspectives: The final chapter summarizes the ongoing ethical problems within the banking sector and suggests that true improvement requires more than just regulatory paperwork.
Keywords
Financial crisis, Banking ethics, Customer-oriented advice, Sales sheet, Performance pressure, Commerzbank, Employee burnout, Investor protection, Statutory consulting protocol, Profit maximization, Financial investment, Regulatory measures, Ethical dilemma, Consultant integrity, Banking supervision.
Frequently Asked Questions
What is the primary focus of this essay?
The essay examines the ethical implications of the pressure exerted on bank employees following the financial crisis and how this pressure leads to inadequate and non-customer-oriented financial advice.
What are the central themes discussed in this work?
Key themes include the institutionalization of sales pressure, the limitations of government and internal regulatory tools, the impact on employee psychological health, and the victimization of investors, particularly the elderly.
What is the core objective of the research?
The objective is to expose the conflict between the bankers' need to meet aggressive profit targets and their duty to provide transparent, risk-aware advice to their clients.
Which scientific or analytical methods are used?
The author employs a qualitative analysis based on personal observations, anecdotal evidence from bank employees, and a critical review of current legislative instruments like sales sheets.
What topics are covered in the main body of the text?
The main body covers the introduction of sales sheets, the efficacy of "fake customer" testing, the internal stress of bank employees due to weekly target reviews, and specific instances of financial products sold to seniors.
Which keywords best characterize the work?
Key concepts include financial crisis, banking ethics, consultant pressure, investor protection, and regulatory failure.
How do "fake customers" impact the banking sector?
According to the author, these testing measures are largely ineffective as they do not address the systemic pressure to sell and the results are not made transparent to the public.
Why are elderly investors particularly vulnerable?
The author notes that seniors often have high trust in their bankers and possess significant savings, making them prime targets for the sale of risky, long-term products like unsustainable property funds.
- Arbeit zitieren
- Birte Fuchs (Autor:in), 2011, Feeding before Moral!, München, GRIN Verlag, https://www.grin.com/document/193028
