TIMES ONLINE: Banks should disclose far more details about their highest paid employees and strict rules should be imposed to defer bonus payouts for at least three years, under a package of measures to improve the banks' management proposed by Sir David Walker.
The proposals stop short of calling for banks to disclose the identities of their best-paid staff who are not on the board. But Sir David says that for "high-end" employees whose pay is greater than the median compensation of the board's executive directors, banks should publish bands of pay above the median, saying how many employees fall into each category and giving a breakdown of salary, bonus, long-term awards and pension.
Sir David's 140-page initial report on how to improve banks’ governance also lays out radical new rules on bonuses, including a stipulation that at least half of a long-term award should be deferred, subjected to further performance criteria and then divided between a three-year and five-year payment.
Executive board members whose pay is above the median should maintain a shareholding equal to their total historic compensation and be discouraged from accelerating a sale of their stake when they leave apart from on compassionate grounds. Any improvement to their pension should also be published, Sir David says. >>> Katherine Griffiths, Banking Editor | Thursday, July 16, 2009
THE TELEGRAPH: Banks Should Publish Pay and Bonuses of All Top Earners, Walker Report Recommends
British banks should publish the pay and bonuses of all their top earners, not just board members, Sir David Walker has recommended in his report on corporate governance in the financial sector.
The long-anticipated report by the former regulator, published on Thursday, recommends a public and regulatory scrutiny of pay practices across financial institutions in order to curb the excesses that brought the financial system to close to collapse.
The far-reaching report, which was commissioned by the Prime Minister in February, also includes recommendations for an overhaul of City pay practices as well as a radical shake-up of boardroom practices and conventions.
The report is broken down into 39 Recommendations of which 12 are dedicated to pay.
He argues that the remit of the Remuneration Committee at banks should be extended to take responsibility for pay policies of the whole firm rather just the board, in particular the staff whose pay exceeds the median level of the executive directors.
The pay levels of these staff, of which he said he found a “surprising number”, should be published in bands rather than by name.
All pay should be heavily linked to performance and the payout of bonuses for top earners should be staggered over five years. >>> Louise Armitstead | Thursday, July 16, 2009