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FSA to delay broader application of remuneration rules |
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On the day before the pre-Budget report is expected to have more bad news for banks and top-earners, this is a rare good piece of news (and indeed this may have been timed to sweeten the medicine being administered over the next few weeks). However, the reprieve will only be temporary. In mid-2010, the FSA is to revisit its Remuneration Code and will consider again how remuneration should be supervised across the rest of the banking sector and in other areas such as insurance and funds.
This makes sense because EU legislation on the regulation of remuneration is progressing under the following umbrellas - CRD 3 for banks and investment firms, UCITS IV and AIFM for fund managers and Solvency II for insurers, life offices and reinsurers. The FSA will also be able to monitor how the Walker proposals are bedding down and take account of the progress of the Government’s Financial Services Bill which contains specific requirements on the regulation of remuneration. Finally, the FSA will be able to take account of the outcome of 2009 bonuses and the process for determining those awards.A summary of the remuneration provisions in the Financial Services Bill and the final report of the Walker Review can be accessed here.
It would have been difficult for FSA to push ahead now while these developments were still going on. However, given the scope of these EU requirements, the reality is that regulation of remuneration will soon be extended across many authorised firms in different sectors albeit at a slightly slower pace than the FSA had originally proposed.
The FSA discussion paper also contains a useful summary of responses to its consultation on the extension of the Code, the FSA’s own reaction to them, as well as listing current European proposals. It also includes an overview of findings from its remuneration visits to some of the 26 firms currently covered by the Code which HR and compensation professionals may find useful. For a link to the FSA’s announcement and feedback paper, please click here.
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Current News
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The FSA has today released a Consultation Paper, which contains proposed revisions to its Remuneration Code affecting pay in the financial services sector. The revisions are proposed to take effect from 1 January 2011 and will mean far more firms are brought within its ambit. ...
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Industry Quotes |
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“more than 7.5 million of Britain's 25.3 million working population have misled their potential employer while applying for a job.”
Mori .
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Quote of the Week
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“"Perseverance is a great element of success. If you only knock long enough and loud enough at the gate, you are sure to wake up somebody.".”
Henry Wadsworth Longfellow
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