sales incentives Archives - Corruption, Crime & Compliance

30 Mar, 2023

Carrie Tolstedt, former Wells Fargo Community Banking Head, Agrees to Plead Guilty and Pay a $17 Million Fine for Obstruction of Regulator’s Investigation

If there ever is an example of a rotten corporate culture, Wells Fargo sits at the head of the class. Since Wells Fargo’s sales pressure scandal, Wells Fargo has continued to suffer from a string of scandals and misconduct. Along the way, and notwithstanding spending millions on lawyers, consultants, accountants and other professionals to fix its culture and controls, Wells Fargo still has not recovered. ...

General

27 May, 2021

Finding the Right Balance: Sales Incentives and Internal Controls

When you look at the core of several major financial scandals, it is easy to point to problems with sales incentives and corporate culture. A company can rapidly grow due to the extraordinary performance of a company’s sales culture. In many cases, this sales culture creates real and significant risks for misconduct. To address such potential for misconduct, companies rely on internal controls to constrain...

General

10 Mar, 2020

The Danger of a Hyper-Focused Sales Culture

We all know that economic incentives are critical to promoting performance. Going back to the days of Adam Smith, the U.S. economic growth is the result of a basic motivation – hard work can result in significant revenues/profits. Companies create incentives for their employees as well – sales performance is linked to salary, bonuses and promotions. We have observed skewed sales incentives, such as the...

General

18 Feb, 2020

The Dangerous Mix of Incentives and “Misconduct”

We often hear about the dangerous risk to a company’s culture from rigorous sales incentive programs. Like most issues, the answer to this issue is not cut and dried. On the one hand, we have a glaring example of failure – the Wells Fargo case. Financial sales staff were subjected to an incredible sales program – for each client, a sales employee was required to...