Authors

Kathryn Clapp

Senior Counsel – Knowledge

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Shireen Shaikh

Senior Counsel – Knowledge

Read More
Authors

Kathryn Clapp

Senior Counsel – Knowledge

Read More

Shireen Shaikh

Senior Counsel – Knowledge

Read More

18 January 2023

Law at Work - January 2023 – 5 of 5 Insights

Hot Topics

  • Quick read

Planned changes to reward, regulation and accountability in Financial Services businesses in 2023

On 9 December 2022, the Government confirmed its intention to abolish the “bankers’ bonus cap” as proposed in the earlier mini-budget held on 23 September.  

Just before the festive break, on 19 December 2022, two consultation papers were released.  The first by the Bank of England and the second by the PRA and FCA who are jointly consulting on the proposal to remove the bonus cap, seeking input from those entities which would be impacted by this action.  Aimed at banks, building societies and PRA Regulated firms, the PRA statement says:

“The proposals to remove the current limits on the ratio between fixed and variable components of total remuneration aim to strengthen the effectiveness of the remuneration regime by increasing the proportion of compensation at risk that can be subject to the incentive setting tools within the remuneration framework – including deferral, payments in instruments, and risk adjustment”. 

There are a number of issues that arise for those businesses that are impacted by the potential change. The consultation closes on 31 March 2023.

The Treasury has also as part of the sweeping Edinburgh Reforms announced plans for both the Government and the PRA/FCA to review the SMCR rules. Information about the detail of the changes is limited.  We do know that the Government intends to launch a call for evidence to look at the legal framework that underpins the regime and the FCA and PRA will review their regulatory frameworks that underpin the SMCR. The call for evidence and review are scheduled for launch in the first quarter of 2023.

We will keep you updated as we have more news on developments. If you have any queries about these developments please do contact Helen Farr or your usual TW adviser.

In this series

Employment, pensions & mobility

2023: Looking ahead to employment law changes

18 January 2023

by Kathryn Clapp

Employment, pensions & mobility

Cases to look out for in 2023

18 January 2023

by Shireen Shaikh

Employment, pensions & mobility

EAT: settlement discussions were without prejudice

18 January 2023

by Shireen Shaikh

Employment, pensions & mobility

Hot Topics

18 January 2023

by Kathryn Clapp, Shireen Shaikh

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