CTRL 3.1.16 Guidance

1 Guaranteed bonuses should generally not be offered because such bonuses are not consistent with sound risk management and performance-based rewards.
2 Remuneration payments should be linked to performance over time and should be designed in a way that does not reward failure.
3 Any deferral of payment to an individual must take into account the risks associated with his or her performance that may materialise during the period of deferment (for example, the risk of an increase in the cost of capital required to support the risks that he or she took; uncertainties in the timing and likelihood of future revenues and expenses).
4 The application of any deferral of payment may vary depending on:
• the level of seniority or responsibility of the individual to whom the payment is due
• the nature of risks to which the firm is exposed
• any other relevant matters.
5 Nothing in rule 3.1.16 prevents a firm from adopting the remuneration policy of a member of the firm’s corporate group, provided that:
• the policy is approved by the firm’s governing body
• the policy complies with rule 3.1.16.

 

Derived from QFCRA RM/2020-4 (as from 1st July 2021)