The National Association of Pension Funds (NAPF) commented on Bob Diamond’s severance package announced by Barclays today.
David Paterson, NAPF Head of Corporate Governance, said:
“Agreement that Mr Diamond will only receive his basic pay and benefits is to be welcomed, given the circumstances. The extent to which clawback can be applied to previous years’ bonuses needs clarification, and reaches well beyond the CEO.
“Barclays’ announcement of ‘an audit of business practices’ should include a full review of pay policy. This is an essential step in rebuilding confidence in the bank, and needs to go beyond senior executives alone. It should also be firmly based on the premise that shareholders, as the providers of risk capital, must earn a sustainable return on that capital before anything is available for distribution to staff.”