Banks may face tough bonus plan

Friday, November 27, 2009

London: British banks face the toughest bonus regime in the world if proposals outlined in a government- commissioned report are accepted, according to its author, Morgan Stanley Senior Adviser David Walker.

Banks should delay bonus payments for as much as five years and have the power to "claw back" awards, Mr Walker, 69, said in his final report on improvements to British corporate governance released. The government strongly supports Mr Walker’s recommendations "and will take steps to implement them as soon as possible," according to a statement from Chancellor of the Exchequer Alistair Darling.

"If we implement what I propose, we have a tougher regime than is in place in any jurisdiction in the world," Mr Walker said in a telephone interview. Unless remuneration policies are enforced, then companies "just won’t do it", Mr Walker said.

This story appeared in the printed version of the Irish Examiner Friday, November 27, 2009