Company: HBCYF
Filing Date: 2025-02-20
Form Type: 20-F
Source: 0001089113-25-000040
Chunk: 439

Company: HSBC HOLDINGS PLC
Filing Date: 2025-02-20
Form: 20-F
Chunk 439
---
' reward. Fixed pay is primarily reviewed through our annual pay cycle. Effective in 2025, we have awarded an overall fixed pay increase of 3.6% . The level of increases vary by market, depending on the economic situation and individual roles. The highest increases were made to lower paid colleagues relative to relevant market benchmarks. Variable pay The Committee determined total variable pay of $3,800m , broadly flat compared with the $3,774m awarded in 2023. This was determined based on a review of our performance against financial and non- financial metrics. We considered t he strength of our financial performance in 2024 and the ratio between variable pay and pre- variable pay profit before tax, the Group ’ s performance against key risk and compliance metrics, and our total compensation position compared with market and the broader economic outlook. Total compensation across all our businesses increased relative to 2023, rewarding our colleagues for their contribution to our performance. Distribution of variable pay by business considered relative performance against RoTE , reported profit before tax and cost targets, and performance against risk and compliance metrics. Strong differentiation has meant our highest performers received the largest increases in variable pay compared with the previous year. Ex-post risk adjustments were made to the variable pay of relevant individuals for material risk events over 2024. This included adjustments for some individuals following the conclusion of the investigation into the PRA’s 29 January 2024 Notice for historic depositor protection failings arising in HSBC Bank plc and HSBC UK Bank plc and the Committee now considers this matter closed. Other remuneration matters HSBC's variable to fixed pay ratio Following shareholder approval at the 2024 AGM, the Committee reviewed several options to set new pay ratios and concluded that a single overall ratio of 10:1 was most appropriate, supported by internal guidance to manage expectations on its application. The ratio will apply across the Group, where permitted by regulation. The ratio will support us to materially strengthen alignment of pay and performance in our executive Directors’ remuneration policy. The ratio has limited impact on the wider workforce and is higher than we intend on using in practice. However, the new cap gives us flexibility to reward extraordinary individual performance delivered by a small number of employees in frontline roles. We will continue to keep our pay principles and approach under review, monitoring market developments and competitiveness, to increase the proportion of pay for performance over time. PRA/FCA consultation on UK remuneration rules The Committee welcomes the recent consultation announced by the PRA and FCA