Remuneration Requirements for all APRA Regulated Entities
The submission to the Australian Prudential Regulation Authority (APRA) in relation to the Consultation on remuneration requirements for all APRA-regulated entities was prepared by the Superannuation Committee of the Legal Practice Section.
The aim of this submission is to suggest areas where the wording of draft CPS 511 might be clarified or where we think the wording might not be practical; we have tried to avoid debating matters of policy, with the arguable exception in part of our submission about withholding variable remuneration during an “investigation”.
Subparagraph 20(b)(iii) requires a Registrable Superannuation Entity (RSE) licensee’s remuneration framework to include, at a high level, the structure and terms of remuneration arrangements for a person who is “employed by, or is a contractor of a body corporate (including a service company) that is a related body corporate or connected entity, of the APRA-regulated entity.” We assume that this is only intended to apply to the extent that the related body or associate provides services to the APRA-regulated entity and the person has the potential to affect the provision of those services.
We suggest that this should be clarified. However, the wording should retain sufficient flexibility to accommodate situations where there is a related service company but also alternate structures whereby employees are formally employed by another related party entity (e.g. a parent entity which is not a service entity) and then seconded back to the superannuation/wealth business.
You can read the full submission below.