Interagency Guidance on Sound Incentive Compensation Policies

Incentive compensation practices in the financial services industry contributed to the financial crisis that began in 2007. Bank employees too often were rewarded for increasing short-term revenue or profit without adequate regard to the risks taken to achieve those results. These practices exacerbated the risks and losses at a number of banking organizations and resulted in the misalignment of the interests of employees with the long-term safety and soundness of their organizations. The Federal banking agencies, including the FDIC, have concluded that it is appropriate and urgent that incentive compensation practices be brought under control through issuance of this guidance.

The latest form for Interagency Guidance on Sound Incentive Compensation Policies expires 2023-07-31 and can be found here.

Document policies and procedures (Implementation)

Federal Enterprise Architecture: Economic Development - Financial Sector Oversight