You probably didn’t notice the latest interview with Linda Woodall at the FSA….
Reading into the logic of the regulator leaves a cold feeling of cronyism, at best the regulators view can only be described as an incredibly ignorant perspective.
May I boil down and share an interpretation of these FSA “pearls of wisdom” for you?
So the FSA says…
- Friction is inevitable between entrepreneurs and the regulator (and this is good)
- The regulator is concerned with customer detriment and entrepreneurs are often not.
- The FSA has met firms who personify the types of firms it would like to see thrive post RDR.
(Here is the link for later if you want to check the actual archaic comments made: http://bit.ly/R6aPNS )
A better perspective…
- Friction and tension come from a lack of clarity and mutual understanding between people or groups. This is to be avoided and is bad.
Is tension a good thing between members of a family or between countries? Is friction a goal which organisation aim to foster between employees? No.
A willingness to accept tension and friction is to absolve responsibility for running an effective organisation or an effective relationship. To state that this is actually a goal for the organisation? What a shocking manifestation of the FSAs insular culture?
- Entrepreneurs are good people whose efforts benefit customers, they are also actually only successful to the extent which they benefit society.
Entrepreneurs start and run businesses; these businesses are recompensed for the contribution they make to society by their earnings.
The products and services making up this contribution are occasionally brand-new to society or more often they are improvements on what already exists (usually quicker, cheaper or with better quality or service etc..).
Entrepreneurs consistently making marginal improvements (or massive ones) are doing so in order to benefit the customer, this is the best thing about the “law of competition”. This relentless drive for profit from contribution to society should be encouraged.
- The FSA have absolutely no right whatsoever to choose the “type” of firms who will be successful in the UK Financial Services business, that’s the job of the UK public.
The regulator must stick to its Four statutory objectives, it must not be allowed to develop along its own lines. Voicing its opinions as to who should succeed in business (or even that is has an such opinion) breaches the law of competition. This crosses the line into cronyism and away from regulated capitalism.
An old regional manager in the North West at the Woolwich once warned the author to be careful with his exuberance for his craft… “people recruit people like themselves” he warned “so the further up an organisation you manage to put a plonker then the more harm they will do to it”
Does this analogy remain true for industry and society as a whole?
How long will this industry be held back and destroyed by an expensive regulator holding to these harmful and archaic perspectives?
Any comments please share with us …