Top funds forced to set up pay panels
LARGER hedge funds may be forced to set up remuneration committees, mirroring listed companies, according to the fine print of the European Union’s directive on banking.
The text thrashed out by the European parliament and member countries says: “Credit institutions and investment firms that are significant in terms of their size, the scope and the complexity of their activities, should be required to establish a remuneration committee as an integral part of their governance.”
The requirement would add a layer of compulsory bureaucracy to some of London’s most successful funds.
The EU also said staff should be banned from using personal hedging strategies to get around the deferral element of its plans to align bonuses more closely with risk.