Andrew Tyrie, the chairman of the Treasury select committee, has written to the FSA asking the regulator to provide more disclosure on high-end executive pay within the banking sector.
Tyrie says that during the committee’s evidence sessions with bank executives, banks have been reluctant to release the information, for fear of putting themselves at a competitive disadvantage.
Tyrie says: “As we have heard in evidence to the committee, without international agreement for disclosure of remuneration at the top level, the banks are understandably reluctant to release information which they consider may place individual firms at a competitive disadvantage.”
The letter calls on Hector Sants, the chief executive of the FSA, to release as much information as possible for use by the committee in their enquiries.
He calls on Sants to provide aggregated information on high-earning staff at leading banks in a banded form, as proposed by the Walker Review, which would reveal the number of people earning between £1m and £2.5m, £2.5m and in £5m bands thereafter. (article continues below)
He also asks for aggregated information on the number of employees in major financial institutions earning the same or more than the lowest paid executive board member.
Tyrie says this “aggregation” should address the banks’ concerns over competition, while providing a measure of disclosure on the number of highly-incentivised employees in the largest and most systemically significant banks.
In the letter, Tyrie says while remuneration information on board members is available within the accounts of financial firms, details of pay of highly paid members of staff who may have considerable sway over a firms risk profile is not.
He also says the committee is concerned to ensure remuneration structures are aligned with the interests of shareholders.