AUSTRIA: FMA applies ESMA Guidelines on Sound Remuneration Policies under AIFMD

Friday August 30 2013

The Austrian Financial Markets Authority (FMA) has announced that it intends to apply the ESMA Guidelines on sound remuneration policies under the AIFMD and has issued formal confirmation to that effect to the European Securities and Markets Authority (ESMA).

Under the Guidelines, AIFMs will be obliged to disclose all relevant information on remuneration policies. According to the FMA, the Guidelines are an important step in curbing excessive bonus payments throughout the financial system. The compensation system for managers may create incentives in the financial services arena to take excessive risks.

The term “remuneration” includes all forms of fixed or variable payments and benefits to employees. The proportion of variable remuneration has to be performance-based and risk-weighted, and can, depending on the employee`s influence on the risk profile, fall to zero.

The Guidelines further stipulate that the compensation system should be checked by the supervisory body of the AIFM at least annually in order to ensure that it is in line with national and international standards.

Click on the above link for the FMA press release. (German)