Barclays 2014 Annual Report Download - page 85

barclays.com/annualreport Barclays PLC Annual Report 2014 I 83
The following chart illustrates our commitment to controlling and reducing variable remuneration:
Group
Investment Bank
£3,484m
(47%)
(60%)
£2,660m
2010
£1,378m
£2,378m
2013 2014
£1,053m
£1,860m
Barclays incentive pools
£2,578m
2011
£1,737m
£2,168m
2012
£1,394m
Note
2013 Investment Bank incentive awards have been restated from £1,574m to reflect the business reorganisation outlined in the Strategy Update on 8 May 2014. 2010, 2011 and 2012
Investment Bank incentive awards have not been restated.
What have you done in terms of risk and conduct adjustments in 2014?
The Committee takes risk and conduct matters very seriously and will continue to ensure that there are appropriate adjustments to both individual
remuneration and, where necessary, the incentive pool.
Conduct is included as a key metric in the Balanced Scorecard and risk and conduct events are considered as part of the performance
management process and reflected in incentive decisions for individuals. All employees have their performance assessed against objectives (the
‘what’) as well as demonstration of Barclays Values and Behaviours (the ‘how’).
To support this there is a strong governance structure with a dedicated review body, the Remuneration Review Panel (Panel), which reports
directly to the Committee. The Panel is independent of the business and includes senior representatives from the key control functions of Risk,
Compliance, Internal Audit, Legal and HR. It sets the policy and processes and is responsible for assessing the impact on compensation of risk and
conduct events.
It is the Committee’s intention that individuals who are accountable, responsible or directly culpable for risk and conduct matters are subject to
remuneration reductions as appropriate. This will include reductions to bonus and unvested deferred awards (i.e. malus reductions). While
investigations are ongoing, individuals who are under investigation will be subject to suspensions of variable pay, in line with our Values and the
expectations of our regulators. For current employees who are directly culpable, disciplinary action up to and including dismissal may also result.
In 2014 reductions were made to the incentive pool funding by the Committee for a number of conduct and risk events. These included the
ongoing Foreign Exchange trading investigations, PPI, the fines received for gold price fixing, for breaches of the FCA’s Client Asset rules and the
US Securities and Exchange Commission’s sanction for compliance violations as well as other issues requiring remediation.
With respect to the ongoing Foreign Exchange trading investigations, although no resolutions have yet been reached with the relevant
investigating authorities, the Committee adopted a prudent approach. The 2014 incentive pool has as a result been adjusted downwards by the
Committee. The Committee will, however, keep the matter under review.
Total incentive awards granted – current year and deferred (audited)
Barclays Group Investment Bank
Year Ended
31.12.14
£m
Year Ended
31.12.13
£m % Change
Year Ended
31.12.14
£m
Year Ended
31.12.13a
£m % Change
Total current year bonus 885 957 8 381 411 7
Total deferred bonus 757 1,140 34 634 921 31
Bonus pool 1,642 2,097 22 1,015 1,332 24
Commissions, commitments and other incentives 218 281 22 38 46 17
Total incentive awards granted 1,860 2,378 22 1,053 1,378 24
Proportion of bonus that is deferred 46% 54% 62% 69%
Total employees (full time equivalent) 132,300 139,600 5 20,500 22,600 9
Average value of incentive award granted per employee £14,100 £17,000 17b£51,400 £61,000 16
Notes
a 2013 Investment Bank figures have been restated to reflect the business reorganisation outlined in the Strategy Update on 8 May 2014.
b Average value of incentives granted for Barclays Group excluding the Investment Bank and Non-Core is down 9%.
The Strategic Report Governance Risk review Financial review Financial statements Shareholder information