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  • HC-5 HC-5 Remuneration of Approved Persons

    • HC-5.1 HC-5.1 Principle

      • HC-5.1.1

        The licensee must remunerate approved persons fairly and responsibly.

        January 2014

    • HC-5.2 HC-5.2 Remuneration Committee

      • HC-5.2.1

        The board should establish a remuneration committee of at least three directors which should:

        (a) Review the licensee's remuneration policies for the approved persons, which should be approved by the shareholders and be consistent with the corporate values and strategy of the licensee;
        (b) Make recommendations regarding remuneration policies and amounts for approved persons to the whole board, taking account of total remuneration including salaries, fees, expenses and employee benefits; and
        (c) Recommend board member remuneration based on their attendance and performance.
        January 2014

      • HC-5.2.2

        The committee may be merged with the nominating committee.

        January 2014

    • HC-5.3 HC-5.3 Remuneration Committee Charter

      • HC-5.3.1

        The committee should adopt a written charter which should, at a minimum, state the duties in Paragraph HC-5.2.1 and other matters in Appendix C of this Module.

        January 2014

      • HC-5.3.2

        The committee should include only independent directors or, alternatively, only non-executive directors of whom a majority are independent directors and the chairman is an independent director. This is consistent with international best practice and it recognises that the remuneration committee must exercise judgment free from personal career conflicts of interest.

        January 2014

    • HC-5.4 HC-5.4 Standard for all Remuneration

      • HC-5.4.1

        Remuneration of approved persons must be sufficient enough to attract, retain and motivate persons of the quality needed to run the licensee successfully, but the licensee must avoid paying more than is necessary for that purpose.

        January 2014

      • Alignment of All Staff Remuneration with Compliance with AML/CFT Requirements

        • HC-5.4.2

          The performance evaluation and remuneration of senior management and staff of the licensee must be based on the achievement of the Key Performance Indicators (KPIs) relevant to ensuring compliance with AML/CFT requirements as specified in Paragraphs FC-2.1.3 and FC-2.1.4.

          Added: April 2020

    • HC-5.5 HC-5.5 Non-Executive Directors' Remuneration

      • HC-5.5.1

        Remuneration of independent directors and non-executive directors must not include performance-related elements such as grants of shares, share options or other deferred stock-related incentive schemes, bonuses, or pension benefits.

        January 2014

    • HC-5.6 HC-5.6 Senior Management's Remuneration

      • HC-5.6.1

        Remuneration of senior management must be structured so that a portion of the total is linked to the licensee's and individual's performance and aligns their interests with the interests of the shareholders.

        January 2014

      • HC-5.6.2

        Such rewards may include grants of shares, share options and other deferred stock-related incentive schemes, bonuses, and pension benefits which are not based on salary.

        January 2014

      • HC-5.6.3

        If a senior manager is also a director, his remuneration as a senior manager must take into account compensation received in his capacity as a director.

        January 2014

      • HC-5.6.4

        All share incentive plans must be approved by the shareholders.

        January 2014

      • HC-5.6.5

        All performance-based incentives should be awarded under written objective performance standards which have been approved by the board and are designed to enhance shareholder and the licensee's value, and under which shares should not vest and options should not be exercisable within less than two years of the date of award of the incentive.

        January 2014

      • HC-5.6.6

        All plans for performance-based incentives should be approved by the shareholders, but the approval should be only of the plan itself and not of the grant to specific individuals of benefits under the plan.

        January 2014