Regulatory Alerts2020-05-19
Remuneration Policies in Financial Undertakings and Investment Firms
The Norwegian Financial Supervisory Authority issued Circular 2/2020 to implement EU capital requirements regarding remuneration policies for financial and investment firms. The document mandates that firms establish written policies ensuring a balance between fixed and variable pay, with variable components capped at 100% (or 200% with shareholder approval) and subject to deferral, malus, and clawback mechanisms. It further details specific identification criteria for risk-takers and control function staff, requiring rigorous risk-adjusted performance assessments and transparent reporting to the regulator.
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