HSBC has announced that it will reduce the amount of money executive directors can receive in lieu of pension contributions, following criticism of its previous policy.
In a statement, HSBC revealed that its Remuneration Committee had decided to reduce the cash available in lieu of pension allowances from 30 per cent to 10 per cent of their base salary for any new executive directors.
The decision comes following criticism of the bank’s decision to pay its chief executive, John Flint, £372,000 a year in place of contributions to his pension, which made up part of his £4.58m paycheque in 2018.
For regular staff, HSBC paid a maximum of 16 per cent in pension contributions, compared to Flint’s allowance of 30 per cent of his base salary.
The bank reported that current executive directors asked for their pension allowance to be brought in line with the new proposed policy, a decision that will be voted on in the annual shareholder meeting on 12 April.
Commenting on the announcement, HSBC Remuneration Committee chairwoman, Pauline van der Meer Mohr said: "Today we are announcing an important clarification of our new remuneration policy to reduce executive director pension contributions following consideration of emerging market practice.
"We have consulted closely with shareholders and listened to their views. Our guiding principle has been to create a policy that is simple, transparent and in the interests of all stakeholders.
"We believe this is the right thing to do for the business, for our employees and for our shareholders.
“I would like to express the committee's appreciation for the engagement by our shareholders on this issue and, in particular, the request made by the current executive directors to conform their pension allowance with the new remuneration policy."
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