APRA is creating a new prudential standard relating to remuneration requirements across all APRA-regulated industries. The new requirements will help regulated entities align remuneration practices with risk, performance and their long-term viability.
New cross-industry prudential standard on remuneration requirements
On 12 November 2020, APRA released an updated prudential standard for remuneration for a second round of consultation. The accompanying response paper sets out APRA’s response to industry’s feedback on the initial consultation proposals released in July 2019.
Written submissions are requested by 12 February 2021.
The response paper, revised draft prudential standard and non-confidential submissions to the initial consultation can be found below:
Revised draft prudential standard
On 23 July 2019, APRA released for consultation a discussion paper on the creation of a new prudential standard aimed at clarifying and strengthening remuneration requirements for all APRA-regulated entities.
Draft Prudential Standard CPS 511 Remuneration introduces heightened requirements on entities’ remuneration arrangements in response to evidence that existing arrangements have been a factor driving poor consumer outcomes. The proposed framework addresses recommendations 5.1 to 5.3 from the Final Report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, which were endorsed by the Government in February.
Written submissions are requested by 23 October 2019.
The discussion paper and draft prudential standard can be found below:
Note on submissions
It is APRA's policy to publish all submissions on the APRA website unless the respondent specifically tells APRA in writing that all or part of the submission is to remain confidential. An automatically generated confidentiality statement in an email does not satisfy this purpose. If you would like only part of your submission to be confidential, you should provide this information marked as 'confidential' in a separate attachment.