Remuneration
Recommendation 5.1 – Supervision of remuneration – principles, standards and guidance In conducting prudential supervision of remuneration systems, and revising its prudential standards and guidance about remuneration, APRA should give effect to the principles, standards and guidance set out in the Financial Stability Board’s publications concerning sound compensation principles and practices. Recommendations 5.2 and 5.3 explain and amplify aspects of this Recommendation. Recommendation 5.2 – Supervision of remuneration – aims In conducting prudential supervision of the design and implementation of remuneration systems, and revising its prudential standards and guidance about remuneration, APRA should have, as one of its aims, the sound management by APRA‑regulated institutions of not only financial risk but also misconduct, compliance and other non‑financial risks. Recommendation 5.3 – Revised prudential standards and guidance In revising its prudential standards and guidance about the design and implementation of remuneration systems, APRA should:
Recommendation 5.4 – Remuneration of front line staff All financial services entities should review at least once each year the design and implementation of their remuneration systems for front line staff to ensure that the design and implementation of those systems focus on not only what staff do, but also how they do it. Recommendation 5.5 – The Sedgwick Review Banks should implement fully the recommendations of the Sedgwick Review. |
Culture and governance
Recommendation 5.6 – Changing culture and governance All financial services entities should, as often as reasonably possible, take proper steps to:
Recommendation 5.7 – Supervision of culture and governance In conducting its prudential supervision of APRA‑regulated institutions and in revising its prudential standards and guidance, APRA should:
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