FCA - Final Rule - PS15/16 Executive Compensation
|Proposal Date||Comment Deadline||Final Rule Issue|
|Jul 30, 2014||October 31, 2014||June 23, 2015|
On June 23, 2015 The FCA and the PRA issued a joint Statement on Executive Compensation that institutes new rules.
The aftermath of the 2008-2009 financial crisis initiated many governments' regulatory agencies to begin to revisit the subject of executive compensation. Other legislation like CRD IV and other implementations of Basil III have sought to decrease reckless risk taking so as to force risk takers to think more long term.
Final Rules Summary
The final rules include the following:
- Senior Management and risk takers will not be able to receive bonuses until 7 years after the performance period
- Non-Executive directors will be barred from getting bonuses
- Bonuses can be clawed back for 7 years, and up to 10 years for senior managment
- Companies that are supported by the government cannot issue bonuses
Rule as Published
- Regulators launch new rules governing bankers' bonuses. BBC. Retrieved on June 23rd, 2015.