Salary & Bonus

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	Salary & Bonus

France strengthens bonuses supervision

France steps up supervision of market operators’ bonuses with the implementation of European Directive CRD3

Article also available in : English | français

Christine Lagarde, french finance minister, welcomes the publication on December 17th of the order, which transposes the EU directive known as "CRD3" relative to the supervision of market operators’ compensation. This ministerial order adapts the existing regulatory framework, resulting from the order of November 3, 2009 and supplemented by professional standards adopted by the french banking federation (Fédération des banques françaises, FBF) and the french association of financial markets (Association française des marchés financiers , AMAFI), by which France has been the first country to implement the framework rules for market operators’ bonuses decided by the G20 in Pittsburgh.

Quantitative rules relative to deferred payment or payment in shares of variable compensation, which were previously identified in professional standards, are now included directly in the body of the order. These rules aim to defer the payment, over a minimum period of three years, of at least 40% of bonuses and up to at least 60% for higher salaries. They also plan the payment of 50% of variable compensation in shares or equivalent instruments.

The supervisory authority, responsible for ensuring compliance with these rules, sees also strengthened its power to impose a revision of the remuneration policy for banks if not consistent with good risk management and long-term growth objective.

Next Finance , December 2010

Article also available in : English | français

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