Document ID: chunk:federal_register_of_legislation:F2023L01348:front:0:p11
Version: federal_register_of_legislation:F2023L01348
Segment Type: other
Provision Reference: 
Character Range: 28374–31692

and the relevant business unit; and
(c)          is justified on the basis of the performance of the person, the relevant business unit and the entity.
46.         An APRA-regulated entity's variable remuneration outcomes must link to and be supported by the entity's performance management system, code of conduct and consequence management processes.
47.         An APRA-regulated entity must not accelerate the vesting of unvested variable remuneration for a person in a specified role no longer employed or engaged by the entity, unless specific exceptions[13] have been included in the remuneration policy. If that person is eligible for any unvested variable remuneration, it must be subject to the same vesting conditions as those for a person employed or engaged by the entity.

Specified roles
48.         An APRA-regulated entity must prudently manage the variable remuneration arrangements of all persons in specified roles.
49.         The Board Remuneration Committee, or relevant oversight function, must provide clear guidance to senior management on its expectations in determining the appropriate level and timing of risk adjustment to the variable remuneration outcomes for persons in specified roles.
50.         The Board Remuneration Committee must make recommendations to the Board annually on the remuneration arrangements and variable remuneration outcomes for persons in specified roles as follows:
(a)          individually for senior managers and executive directors;[14] and
(b)          on a cohort basis for highly-paid material risk-takers, other material risk-takers and risk and financial control personnel.
51.         When forming its recommendations under paragraph 50 of this Prudential Standard, the Board Remuneration Committee must:
(a)          obtain sufficient information to enable remuneration outcomes to be commensurate with performance and risk outcomes; and
(b)          determine whether the variable remuneration arrangement, individually and on a cohort basis:
(i)            is appropriate to meet its intended purpose and expected remuneration outcomes; and
(ii)         supports the entity's compliance with paragraph 21 of this Prudential Standard.
52.         The Board, or relevant oversight function, must approve the variable remuneration outcomes for persons in specified roles as follows:
(a)          individually for senior managers and executive directors;[15] and
(b)          on a cohort basis for highly-paid material risk-takers, other material risk-takers and risk and financial control personnel.
53.         The variable remuneration arrangements for risk and financial control personnel must:
(a)          reflect the independence and authority of those personnel in carrying out their functions;
(b)          reflect the purpose of their functions; and
(c)          not be unduly influenced by the performance of the business activities they control.

Review of the remuneration framework
54.         An APRA-regulated entity must review compliance of the remuneration framework against the requirements of this Prudential Standard at least annually.
55.         In addition to the annual review of compliance, the effectiveness of the remuneration framework must be subject to a comprehensive review by operationally independent, appropriately