Reward Practices in Financial Services
On 5 October 2009, the Belgian Banking Finance and Insurance Commission (CBFA) launched a public consultation on a draft practice note addressing remuneration policies in financial institutions (including banks, insurance companies, brokers and investment companies). The consultation ended on 19 October 2009. The CBFA has confirmed that the final practice note can be expected in the next few days. Its purpose is to ensure that remuneration policies in financial institutions encourage effective, sound risk management and do not create incentives for inappropriate risk-taking.
Implementation deadlines are strict!
Financial institutions must define a remuneration policy in compliance with the CBFA standards by 31 December 2009.The applicable remuneration policy, the state of its implementation and evidence that it complies with the CBFA standards must be sent to the CBFA no later than 15 February 2010.
Financial institutions must implement a compliant remuneration policy by 1 April 2010 and amend existing agreements (e.g. employment agreements) as soon as possible.
Failure to fulfil all the CBFAstandards will result in greater Commission scrutiny and could lead to an increase in capital requirements. Consequently, it is of strategic importance to all FS companies that they should be able to demonstrate in time that they have assessed their remuneration policies and taken suitable action to comply with the applicable standards.
How PwC can help you
PricewaterhouseCoopers can help you demonstrate that your remuneration policies comply with BBFIC standards.
Our methodology enables management and remuneration committees to:
- Quickly identify areas where CBFA standards suggest changes to your remuneration policies are needed;
- Benchmark your current situation against the CBFA standards and those of your peers;
- Identify and prioritise areas of risk reduction during each phase of our work;
- Provide independent assurance to stakeholders over the design and operating effectiveness of your remuneration policies and procedures.
Our methodology is underpinned by PricewaterhouseCoopers’ knowledge of best practice controls in this area and our thought leadership in thirdparty assurance.
Our skills and experience include a team of regulatory, compliance, reward, tax, risk and control specialists who can provide recommendations and alternatives to enable efficient, effective compliance with regulatory requirements.
For more informattion, read the Reward Practices in Financial Services flyer.
