I broadly agree with the report’s first idea, namely that governments should not regulate the absolute levels of executive compensation in financial institutions. On that point, I would like to make the following remarks. 9  At the present juncture, the principles and standards for sound compensation practices have mainly been designed to apply to a relatively large range of employees, i.e.
those “categories of staff whose professional activities have a material impact on the bank’s risk profile” (see “Compensation Principles and Standards – Assessment Methodology”, January 2010, BCBS). These categories include senior managers and others; material risk-takers (e.g. traders) and staff performing important risk management and control functions are also targeted by the framework.