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FSA - The Future Of Bonuses
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Date: 11th May 2009
Members will be aware that incentive pay arrangements and their impact on the way in
which employees behave is now firmly under the spotlight, following the publication of the FSA’s draft Code Of Practice on remuneration policies which covers all FSA regulated firms. The focus of the Code Of Practice is not what is, or is not, an appropriate level of reward for an individual member of staff but how they are structured to encourage the right behaviours.
This review is not just about executive pay arrangements but will in fact cover all staff at all levels of
the Lloyds Banking Group. One of the proposed principles set out in the Code Of Practice is that not less than two-thirds of larger bonuses should be deferred for a minimum period of time and the payment of that deferred element should be linked to future performance.
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