Banks and other financial institutions may be in for a bumpy ride in coming months, thanks to a proposed rule on incentive compensation that would impose new structural and compliance burdens on how executives get paid. Other business sectors should take notice too, since the rule could set a compensation standard.
The Federal Deposit Insurance Corp. issued its proposed rule, required by the Dodd-Frank Act, last month. It would set longer time horizons on incentive-based compensation and require a review of compensation practices for employees who expose financial firms to substantial risk.
