Bankers’ Remuneration Reforms and Future Challenges

41 Pages Posted: 24 Jul 2020

See all articles by Anna (Ania) Zalewska

Anna (Ania) Zalewska

University of Bath - Centre for Governance, Regulation and Industrial Strategy; School of Management

Date Written: July 1, 2020

Abstract

The desire to structure the remuneration of top banking executives and other material risk takers (MRTs), particularly the elements that are risk sensitive and aligned with long–term incentives of their institutions, is at the centre of the regulatory debate. This discussion is part of the wider debate on the creation of cross–country banking regulation that is aimed at reducing systemic risk in the banking industry whilst maintaining its competitive and innovative elements. Following the introduction of the Capital Requirements Directives (CRD) III and IV the academic literature has shed some light on the benefits and costs of restrictions on variable pay, malus and clawbacks, and group behaviour of MRTs. Yet, we are still far from understanding the real costs and benefits of these reforms and the forthcoming CRD V, and how these will support the demands of fintech transformation of the banking industry and the need to promote sustainable finance.

Keywords: banking, remuneration, fintech, climate change risk, sustainability, regulation

JEL Classification: G20, G28, G38, G01, G39

Suggested Citation

Zalewska, Anna, Bankers’ Remuneration Reforms and Future Challenges (July 1, 2020). Available at SSRN: https://ssrn.com/abstract=3640239 or http://dx.doi.org/10.2139/ssrn.3640239

Anna Zalewska (Contact Author)

University of Bath - Centre for Governance, Regulation and Industrial Strategy; School of Management ( email )

Claverton Down
Bath, BA2 7AY
United Kingdom
+44 0 1225 384354 (Phone)
+44 0 1226 384354 (Fax)

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
33
Abstract Views
200
PlumX Metrics