This year will see marked changes to bonus and incentive plan structures as the financial services market tries to address the perception that large bonuses contributed to excessive risk-taking in the credit crisis, an expert has said.
According to Mike Eckes, reward partner at KPMG, companies could implement 'clawback', meaning employees will be forced to pay back bonuses if future performance does not match past rewards.
The changes could also include reshaping asymmetrical bonus structures and imposing more regulation.
Mr Eckes commented: "Clawback provisions may become the norm for annual bonus plans, as a means of addressing the risk of bonuses being determined solely by reference to performance in a single financial period.
"We are already starting to see these measures being introduced."
Meanwhile, business executives have said a culture of encouraging and rewarding excessive risk contributed to the financial crisis.
Research from the Aziz Corporation suggested that 83 per cent thought a "macho" culture fuelled the failure to foresee problems and around half believed that more women in senior positions could have prevented some of the excesses.
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