More than nine in 10 (93%) respondents expressed concern about losing talented staff to international opportunities as a result of the EU bankers’ bonus cap, according to research by Robert Half Financial Services.
Its research, which surveyed 100 UK executives at financial services firms, found that 38% are ‘very concerned’ and 55% are ‘somewhat concerned’ about the impact of the pending regulation.
The EU bonus cap, which is due to take effect from January 2014, will see bankers’ bonuses capped at 100% of fixed salary, or 200% with shareholder approval.
The research found that, in a bid to prevent an exodus of talent, two-thirds (65%) of respondents have increased salaries by an average of 20%, while one-fifth of respondents have increased salaries by 30%.
More than half (52%) of respondents are ‘very concerned’ and 41% are ‘somewhat concerned’ that the bonus cap and resulting rise in base pay will create an unstable cost structure for the organisation.
Almost two-thirds (60%) have increased the benefits on offer to staff.
Neil Owen, global practice director at Robert Half Financial Services, said: “Financial services leaders are evidently concerned about the impending EU bonus cap and its potential impact on the industry’s talent pool, particularly as firms look to their top staff to pursue growth strategies.
“A number of large UK financial services firms have already been examining ways to offset the cap, potentially raising salaries and benefits to retain key employees.
“With the UK competing with other international centres for the world’s top financial services talent, firms will need to strike the balance between risk and reward, with additional employee remuneration potentially creating an unstable cost structure.”
