Under the revised CRD III, as agreed upon by the European institutions, CEBS
is required to elaborate and issue guidelines on sound remuneration policies in
the financial sector in order to facilitate the compliance of the remuneration
principles included in the amended Annex V of the CRD.
Article 22 of the revised CRD lays down the fundamental principle whereby institutions
are required to ensure that their remuneration polices and practices are consistent
with their organisational structure and promote sound and effective risk management.
The remuneration requirements included in the CRD are divided into three blocks:
Proportionality is key in this domain and applies to the three blocks, both to
the general as well at to the specific requirements of the CRD III. For every
principle, guidance is given to both institutions and supervisors so as to ensure
that the new risk-related philosophy on remuneration in the financial sector is
promptly translated into action. Finally, the current guidelines do not only address
high-level remuneration policies in institutions, but also the day-to-day practices
of remuneration decisions and procedures through which the policy is implemented.
CEBS would like to draw attention to a number of areas where it would particularly
welcome views. These include: retention period, as outlined in paragraph 125 onwards
where comments on the appropriate retention period are sought; and minimum portion
of instruments and their distribution as outlined in paragraph 130, where it is
CEBS understanding that it is the EU legislators’ intention that the 50% minimum
threshold for instruments applies equally to the non-deferred and the deferred
parts.
CEBS submits its initial views for a public consultation which starts today and
runs until 8 November 2010. Comments received will be published on CEBS’ website
unless respondents request otherwise. Please send your comments to the following
email address: CP42@c-ebs.org.
The consultation is open to all interested parties, including supervised institutions
and other market participants. A public hearing will take place on 29 October
2010 at the CEBS’s premises in order to allow all interested parties to present
their comments.