The Commission has published two Recommendations on remuneration. The first covers structure and determination of remuneration of directors of listed companies. It includes setting a limit on severance pay and to ban it in case of failure and to allow companies to claw back variable pay if paid on the basis of manifestly misstated data. It also suggests a stronger role for remuneration committees. The second Recommendation covers principles on remuneration of risk-taking staff in financial institutions. It covers:  

  • structure of pay (including setting a balance that promotes risk management, deferring and being able to claw back bonuses);
  • governance (including an obligation to have independent board members involved in designing and implementing policies);  
  • disclosure; and  
  • supervision (encouraging regulators to look at the nature and scale of each institution to assess appropriate policies).  

Although these principles are in the form of Recommendations, the Commission expects Member States to implement them and will review what they have done after one year.