Reporter Wang Siwen
Recently, the Asset Management Association of China (hereinafter referred to as AMAC) issued the "Guidelines for Performance Evaluation and Remuneration Management of Fund Management Companies" (hereinafter referred to as the "Guidelines"), which provides detailed guidance on compensation structure, compensation payment, performance appraisal, compensation internal control management, etc. Specific requests were made.
Industry insiders generally believe that this is a major policy construction in the public fund industry, which further promotes the sustainable and high-quality development of the industry. The effective implementation of the Development Opinions.
Performance appraisal and compensation management
Four basic principles to be followed
The "Guidelines" clearly states that fund management companies should follow four basic principles in performance appraisal and compensation management: First, the interests of fund share holders should be prioritized and the company's long-term sustainable development should be the orientation.Second, it can not only effectively motivate employees, build a high-quality talent team, but also help prevent risks and improve compliance.The third is to balance the interests of employees, managers, shareholders and other stakeholders, which will help the company to fulfill its social responsibilities and improve its ability to serve the real economy and national strategy.Fourth, it is in line with my country's national conditions, policy orientation and the actual development of the fund industry.
"Through the adjustment of the incentive policies for the core employees of fund managers, the mechanism for binding the interests of fund practitioners and fund share holders has been strengthened." said Lv Wei, an analyst at Minsheng Securities, "The Guidelines are another policy-level impact on public funds. With the help of development, combined with the continuous capital market reform this year, we believe that companies oriented on the wealth management track are expected to benefit deeply."
Liu Xinqi, an analyst at Guotai Junan Securities, said, "The "Guidelines" provide an improvement plan for the current problems in my country's public fund industry that focus on short-term performance and create a large number of products with higher short-term yields to meet customer needs. The introduction of the "Guidelines" can greatly To a large extent, standardize the behavior of public funds, reverse the extensive development of the industry, build a good industry ecology, and guide fund companies to build a long-term incentive and restraint mechanism."
It is worth noting that the Guidelines do not directly interfere with the salary level of fund management companies, but require fund management companies to reasonably determine and timely adjust the basic salary standards and salary structure of different positions.The "Guidelines" shall come into force on the date of issuance, and fund companies shall adjust and improve the existing performance appraisal and salary management work before December 20, 2022.
Three breakthrough mechanisms are highlighted
tied to the long-term interests of the holder
The "Guidelines" focus on three breakthrough mechanisms to further promote the long-term healthy development of the industry and protect the long-term interests of holders.
First, a salary deferred payment mechanism has been established.The "Guidelines" make it clear that the period of deferred payment of remuneration shall not be less than 3 years, and the rate of deferred payment shall not be faster than the equal proportion.The applicable personnel include the chairman of the board, senior management personnel, heads of major business departments, heads of branches and core business personnel, etc. The deferred payment amount for key positions such as senior executives and fund managers shall not be less than 40% in principle.
Gao Chao, a non-bank financial analyst at Kaiyuan Securities, said, "This is in line with the original system of domestic fund companies and the practice of overseas asset management companies. Public funds have strong advantages in channels, brands, and investment and research support, and have a strong platform effect. Excellent management People are more attractive, and the establishment of a salary deferred payment mechanism is conducive to the long-term interests of employees and the company and holders, and enhances the credibility of public offerings.”
The second is to clarify the self-purchasing rules that the market has been paying the most attention to.For the first time, the "Guidelines" clarified that senior executives and heads of major business departments should use not less than 20% of the performance compensation for the year for self-purchase, of which the proportion of equity should not be less than 50%, except that the company has no equity fund, etc. .The fund manager shall use not less than 30% of the performance compensation for the current year for self-purchase, and shall give priority to the purchase of public funds managed by himself.
"The refinement of self-purchase rules is also conducive to the long-term interests of core employees and the company and holders. In addition, the market is also concerned about the construction of information disclosure such as fund companies and fund managers' self-purchased funds redemption." Fund practitioners told the "Securities Daily" reporter.
The third is to establish a long-term performance appraisal and incentive mechanism.The "Guidelines" strictly prohibit short-term assessment and excessive incentives, and the economic benefit and investment performance assessment cycle is extended to three years.At the same time, fund management companies are encouraged to adopt diversified incentive and restraint measures such as equity, options, restricted equity, and dividend rights that are bound to the long-term development of the company and the long-term interests of holders, and establish a long-term incentive and restraint mechanism.
"The platform effect of top fund companies is stronger, and their advantages are expected to be prominent. At the same time, companies with a higher degree of market flexibility may have stronger advantages in adopting medium and long-term incentives such as equity and dividend rights." Gao Chao said.
A public fund manager in Beijing told the "Securities Daily" reporter, "The guiding role of compensation in fund management company governance and risk control can further guide fund companies to pay more attention to long-term performance and promote the long-term development of the wealth management industry."
In order to protect the long-term interests of holders, the Guidelines further strengthen the strict accountability mechanism including recourse and kickback.The Guidelines clarify that fund management companies should establish a strict accountability mechanism to enhance the binding force of remuneration management, including but not limited to remuneration suspension, recourse and deduction, etc. If the company is responsible for the behavior or business risks, the company shall investigate the internal economic responsibility in accordance with the relevant regulations of the system, and may stop paying the unpaid part of the remuneration of the responsible personnel, and require them to refund the relevant bonus in the year when the relevant behavior occurred, or stop implementing long-term incentives for them. Wait.Accountability mechanisms should apply equally to those who leave.
Regarding this "Guide", China Foundation Association clearly stated that fund management companies are encouraged to base themselves on the long-term and healthy development of the industry and the company, strengthen capital accumulation, and make overall plans on the premise of strengthening investment in investor education, risk response, information technology and charitable donations. Consider labor costs and shareholder profit distribution.(Securities Daily)
