Finance ministers from the G20 group of major economies today agreed a compromise deal on bankers’ bonuses with the aim of deterring the excessive risk-taking which has been widely blamed for the current global recession.
European proposals for a cap on the size of bonuses, championed by French President Nicolas Sarkozy, were rejected at a summit in London.
But the G20 countries agreed on new regulatory measures to require banks to disclose the pay and bonuses of their highest-paid employees and to allow bonuses to be “clawed back” if deals unravel within three years.
After taking stock of the economic situation ahead of this month’s crucial summit of G20 leaders in Pittsburgh, the finance ministers agreed to continue with expansionary monetary and fiscal policies to support their economies until recovery from recession is secured.
They said they would develop co-ordinated “exit strategies” to deal with ballooning public deficits once the recession is over. But they agreed to continue to press ahead with the “swift and full implementation” of fiscal stimulus packages worth a total of $5 trillion (€3.5 trillion).
In a communique issued as the summit concluded, the finance ministers said: “Financial markets are stabilising and the global economy is improving but we remain cautious about the outlook for growth and jobs and are particularly concerned about the impact on many low-income countries.
“We will continue to implement decisively our necessary financial support measures and expansionary monetary and fiscal policies, consistent with price stability and long-term fiscal sustainability until recovery is secured.”