Cameron calls for bank bonus truce" ran the Financial Times headline on Saturday. To some this truce will look more like a white flag. It is a curious moment to relax the pressure on financiers just when some appear to be acknowledging that things have got out of hand. First among equals, in this regard, is the Royal Bank of Scotland chief executive, Stephen Hester.
For a Master of the Universe, Mr Hester adopted a pretty hushed tone when he appeared on the Today programme last week. Anyone who chanced upon the interview might have assumed that the person speaking was confessing to a moral aberration, or to a hitherto undetected crime.
This CEO does not seem to believe, as Barclays' Bob Diamond clearly does, that the time for remorse is over. Nor did the RBS boss claim, as Goldman Sachs' Lloyd Blankfein once jokingly did, that he was "doing God's work". Mr Hester turned up in the headmaster's study to take his punishment uncomplainingly. But this was not the only display of contrition. The CEO of the mining business Rio Tinto and the entire top team at Network Rail also agreed last week to forgo their large bonuses.
Something is definitely up – or, in terms of remuneration, down. Maybe it is only a temporary phenomenon. But it looks as though the concept of shame could be making a comeback into public life. As top salaries rose ever higher in the past few years it was not obvious that a strong sense of shame existed in company boardrooms. I once asked the former TUC general secretary, John Monks, about these kinds of excessive rewards, and whether anything could be done about them. "How do you shame people who are shameless?", was his reply.
Without perhaps realising it, Mr Hester has helped to explain how shame works, and why it may once more be a factor in the decisions leaders take. In his emailed message to RBS staff last week he said: "There is no doubt that our position in the spotlight makes the job harder."
But that is the point about the consequences of big decisions. They are public. We get to know about them. It has become a cliché to call for greater "transparency" in business, and the results of that transparency are not unproblematic – see the arms race in top pay as executives insist on being seen to be in the "upper quartile" pay bracket.
But where dubious decisions could once be taken in the dark, now the spotlight shines far, wide, and brightly. Public opinion matters. Which is why it was extraordinary to hear the RBS chairman, Sir Philip Hampton, admit the board had failed to anticipate the public reaction to his CEO's proposed £1m bonus. A better informed board would have had a sense of how unacceptable it would be.
Mr Hester now appears to have grasped what his senior colleagues had not. As he told RBS staff in his message: "Many people within RBS and in the wider economies we serve are facing uncertainties around jobs, earnings, housing values and many other things ... None of us, individually or RBS as a whole, exists in a vacuum. We do need to keep in mind that bigger picture."
Too right. No senior executive is an island entire to him – or herself. People do not act alone, even if business life can keep them sheltered from the catcalls of the Occupiers and the rest of the 99%. In the short term, however, it may seem easier for the radical individualists who have got to the top to press on as though no spotlights are shining on them, and nobody is watching. Such leaders lack what the philosopher Adam Smith called "sympathy". While Smith is often cited as the authority who advocated "self-interest" as the prime motivator for business activity, he was at least as concerned about the moral implications of how people behaved.
"Smith wrote about the importance of feeling the gaze of others upon you," says Dr Eve Poole, who lectures in leadership at Ashridge business school. "If you don't feel watched – whether by God or simply the rest of society – how will you operate? And if you have no sense of shame or repentance for what you have done then there really are no limits to what you might do in the future."
Although Ed Miliband's foray into this territory last September was criticised, he has turned out to have been "ahead of the curve", as they say in business. His conference speech reintroduced a moral element to the debate about business conduct. It went down badly in some circles. But when Barclays presented its annual results on Friday the front page of its release was headed "citizenship", and was followed by a description of the bank's beneficial impact on society. Perhaps this was just clever PR. Barclays' bonus payments, while reduced for most, were substantial. But at the very least the bank has acknowledged that its actions have consequences, and that it is not simply an amoral financial machine.
The Swedish company SKF has a nice phrase to describe its business. It aspires "to make a decent profit decently". This sense of decency – and the shame mechanism – lies behind the idea of giving at least one employee representative a seat on a company's remuneration committee.
It has proven easier to wave huge pay packages through without having to look a "shop floor" colleague in the eye and explain why they are necessary and justifiable. There has not been enough pressure on FTSE100 directors in particular to limit the vast (and damaging) gap in salaries between those at the top and everybody else. A much smaller gap exists in corporate Germany where, as the TUC reports: "In most of the remuneration committees of companies with more than 2,000 employees, half the members are worker representatives." Let some ordinary workers in and see who still dares to accept excessive rewards.
In most of the public sector – indeed in most of the country – restraint is being urged, and forced, on employees. Some top executives now seem to realise that restraint would be quite a good option for them too. Meanwhile the attack on benefits payments is conducted in aggressive language that refers to "dependency" and "entitlement". But as bonus season reminds us, there is more than one part of society where a sense of entitlement, and dependency, seems to be a problem. Who is truly "shameless" – the workless families in tough housing estates, or the bankers enjoying another generous pay cheque? Time to point the spotlight in the right direction, and let people rediscover their dormant sense of shame.
The writer is Visiting Professor of management practice at Cass Business School, London