While is it essential to increase the resilience and oversight of the banking sector through long-term financial reform, improving the standards governing those institutions from within is similarly important.
Strong corporate governance is vital to ensure risk is properly managed within financial institutions and that remuneration policy does not encourage excessive risk-taking.
In June 2010, the European Commission published its Green Paper on corporate governance, including its recommendations on the remuneration policies of stock market listed companies and financial institutions. The issue of responsible pay is also being looked at as part of the Commission’s ongoing work around the Capital Requirements Directive, as well as in the Government’s own work on bank bonuses and remuneration.
To download a copy of the European Commission’s Green Paper on corporate governance, please see:
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