Firms evade incentive regulations by relabeling prohibited payments

Evidence

The revised Volcker Rule also tried to change the trading-incentive system. Traders will not be paid bonuses up front as a percentage of profits from trades, regardless of the merits of those trades. If corporations object to regulations, they try to find a way to circumvent them. Banks fought the bonus skirmish semantically by disguising them as “allowances” and “reviewable salary” (Anderson & Eavis, 2014). — Albert Bandura, Moral Disengagement, 1546

Categorization

• CANDY: Banks renaming bonuses ‘allowances’ and ‘reviewable salary’ is a neat, tweetable illustration of semantic loopholing.
• SEED: The language games of financial regulation — how relabeling defeats rule intent — could anchor an essay on euphemism as a moral-disengagement tactic.