EU backs down on fund manager pay cap

European Union lawmakers have narrowly rejected a proposal to cap fund mangers' bonuses, a decision which if approved would have blocked payouts from exceeding annual salaries.

MEPs voted against the measure by 348 votes to 341, as part of a wider vote on the UCITS V directive. However, fund groups will be required to defer bonuses by a number of years, and to disclose remuneration policies to clients, a measure welcomed by the Investment Management Association (IMA). "Clear alignment with client interests and outcomes is fundamental to the asset management industry's ability to support savers and the wider economy," said IMA CEO Daniel Godfrey (pictured). "The European Parliament has voted for proposals that drive true alignment between asset managers' p...