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U.S. Regulatory Authorities to Restrict Wall Street Executives Salary By Lanbo Jiang

  in Business | Published 2012-02-25 21:03:11 | 121 Reads | Unrated

Summary

Nearly the end of Wall Street giants pay once again become a hot topic in public U

Full Content

Nearly the end of Wall Street giants pay once again become a hot topic in public. U.S. regulatory authorities to limit the financial industry is preparing a new initiative on executive pay at the same time, financial institutions have also introduced the reform mechanism.

Goldman Sachs Investment Corporation ("Goldman Sachs") today announced a "long-term performance incentive plan," the company executives bonuses and long-term earnings and stock prices linked to Change the situation in order to reduce excessive speculation.

Executive pay will be linked with the fi
nancial indicators

Goldman's bulletin board at the 23 disclosed the details of the compensation plan. Under the program, distributed to "key employees" of the bonus amount will be with the company revenue, net income and return on equity linked to a series of financial indicators, and cash bonuses in the form of cash, securities or other equity-related assets.

At the same time, Goldman Sachs also said that if the employees there, "the risk of errors of fact or failure to give full attention to risk", etc., will be retained for recovery of money or even make the decision to cancel.

Goldman Sachs spokesman Stephen Cohen said: "The plan is within the Remuneration Committee of Goldman Sachs (compensation Committee) to further its long-term performance-linked executive pay." And specifically which employees could be rewarded for making the remuneration committee will decision, but Cohen refused to disclose the remuneration of the data and what the potential employee, said the salaries and employee has not been determined.

Reported that the company pay levels for executive control measures implemented in the new pay system designed to allow enterprises to more balanced and reasonable, but the move also will help ensure financial stability and security of the enterprise, so as not to encourage "reckless speculation."

Regulatory authorities consider limiting executive pay on Wall Street

In the financial crisis will most Wall Street firms involved in the crisis, leading the government felt compelled to help, the U.S. regulatory authorities required banks to reform executive compensation mechanisms to limit excessive speculation.

Given Dodd - Frank Financial Reform Act requires regulators to ban more than one billion U.S. dollars of assets of financial companies have introduced "improper motivation speculation," the bonus plan, the Fed, the SEC and other federal banking sector, the Bank is to discuss the salary issue.

Pre-paid cash bonuses in the financial crisis, various sectors have been severely criticized, the form of short-term speculation to encourage high-risk behavior: the cash prize has a certain irrevocable, with many executives still caused the banks to take huge losses highly paid to get out.

Most financial firms under the pressure of its own initiative reduced the amount of cash bonuses. Most companies have shifted from a deferred cash bonus stock awards, deferred bonus is becoming a popular form of payment for the recent Wall Street

The form of deferred payment for the company will make employees more motivated long-term interests of the party. U.S. regulatory authorities are brewing the first time this new initiative may be targeted, including banks, brokerages and investment management companies, including the entire financial industry. They may also deferred payment will be set on executive pay scale lower limit.

It is reported that Bank of America, JP Morgan Chase, Goldman Sachs, Morgan Stanley and other Wall Street giants may have to be at least 50% of executive pay in proportion to the shares or other deferred compensation payment, rather than the form of cash advances.

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