Efforts to further reform pay practices at financial firms moved ahead this week.

The board of the Federal Deposit Insurance Corp. voted to float a Dodd-Frank Act mandated rule proposal aimed at curbing incentive pay at the largest financial firms for public comment.

Among other things, the proposal would require the largest firms—those with $50 billion or more in assets—to defer at least 50 percent of incentive-based payments for designated executives for at least three years. The boards of those firms would also be required to identify employees who individually have the ability to expose the institution to substantial risk, and to determine that their incentive pay appropriately balances risk and rewards, according to the 77-page proposing release.

The rule proposal would implement Section 956 of the Dodd-Frank Act, which requires “covered financial institutions” to report on the structure of their incentive-based pay arrangements and bars incentive-based compensation arrangements deemed by regulators as excessive, as encouraging inappropriate risk-taking, or that could lead to material losses. Under the Dodd-Frank Act, “covered financial institutions” include banks, credit unions, registered broker dealers, or investment advisers with assets of $1 billion or more, and Fannie Mae and Freddie Mac.

The rules are aimed at eliminating poor pay bank practices blamed as contributing to the financial crisis. The proposed rule will also better align U.S. compensation standards with those adopted internationally under the framework approved by the Financial Stability Board in 2009, FDIC Chairman Sheila Bair said in a statement.

The other agencies involved in the joint rule making –the five federal members of the Federal Financial Institutions Examination Council, the Securities Exchange Commission and the Federal Housing Finance Agency—must each independently approve the proposal before it's published in the Federal Register. Comments will be due 45 days after publication.

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