My branch manager/sales manager is encouraging the advisors here to favor commissionbased transactional business over fee based advisory business.  Is this ethical or even legal?  

That being said you are stupid not to prioritize recurring revenue. If that means annuities with a trail or advisory accounts with ongoing revenue&service then you really are shooting yourself in the foot if you do not prioritize this. You just have to eat shit for a couple years until your recurring turns into a healthy 'salary' and eventually you'll get over the peak of the hill.

But, it’s up to your client to decide.  

I guess the bigger question is why does your guy recommend commission vs fees?   Does he have a good rationale for it?   And what do you think about it?

Sure, commission business CAN be cheaper for the client sometimes, but in practice, it rarely is unless they are very long term focused (don't change fund families, don't change advisors, etc.).  

Do yourself a favor and work on a fee-basis if you can (and take trails on annuities if you do that business) and your clients.  

The regulatory tide is trending towards fees as well.  Commissions have been illegal in the UK for about 10 years now.  I wouldn't be surprised to see us there someday too.

But commission means eating what you kill, and it can be feast or famine.

Fee based means actually growing a real business with recurring revenue that can support a service model.

Either this manager doesn't expect you to make it or doesn't expect his office to make it.