Sunday, July 20, 2008

'Incentivization' of bank workers under fire

The finance sector union Finsec is teaming up with Green MP Sue Bradford to launch a campaign for fair lending regulations for New Zealand's banks.

Finsec wants all the banks to join a discussion of proposals to phase out, or at least modify, their sales incentives. It claims these incentives have shifted banks from a service- to a sales-driven culture.

In today's edition, the Sunday Star-Times says it has obtained copies of some of the banks' incentive schemes, under which staff are "incentivized" to sell products.

At the ANZ, for example, management sets "revenue targets" before the financial year begins. These show how much money the bank would like to make from its customers for its shareholders in the coming year.

This revenue target is then "translated into required product sales" - the number of mortgages, credit cards and term deposits the bank needs to sell to reach the target.

Every employee with a sales role is then given his or her personal target, which requires minimum sales in each category to qualify for a bonus.

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