Remuneration & Variable Pay Policy¶
| Code | PPL-002 |
| Domain | People & Culture |
| Owner | Chief People Officer |
| Status | Draft |
| Applicability | External — Remuneration governance for the operating entity's employees. External HR and governance process. In Track 1 this includes APRA-regulated remuneration standards for bank executives. |
| Jurisdiction | NZ + AU |
| Business domain | BD11 |
| Review date | 2027-03-25 |
Outside platform boundary
Remuneration governance for the operating entity's employees. External HR and governance process. In Track 1 this includes APRA-regulated remuneration standards for bank executives.
Regulations: Financial Accountability Regime (FAR) · CPS 520 Fit and Proper¶
Purpose¶
This policy governs the design, approval, and oversight of remuneration structures for all employees and executives of the bank, with particular attention to variable pay, deferral arrangements, and risk-adjusted outcomes. It ensures remuneration practices support sound risk management and comply with APRA's Prudential Standard CPS 520 and the Australian Financial Accountability Regime (FAR).
Scope¶
This policy applies to all employees of the bank, including executives, Accountable Persons under FAR, and material risk takers as defined by APRA. The variable pay and deferral requirements apply primarily to senior executives and roles with the capacity to materially affect the bank's risk profile. Fixed remuneration for all other employees is also subject to the governance framework set out here.
Policy statements¶
The bank's remuneration framework SHALL be designed to attract, retain, and motivate high-quality staff while discouraging excessive risk-taking and aligning individual outcomes with the long-term interests of customers, shareholders, and regulators.
The Board Remuneration Committee (RemCo) SHALL have oversight of the remuneration framework, including approval of total remuneration for the CEO and all direct reports, approval of the variable pay pool, and review of any material changes to the structure of remuneration across the bank. RemCo SHALL meet at least twice annually and SHALL produce a written report of its deliberations for the Board.
All variable pay arrangements SHALL include a risk adjustment mechanism. No bonus or incentive payment SHALL be made without a documented assessment of the relevant employee's risk and conduct outcomes for the performance period. Where risk outcomes are poor, variable pay SHALL be reduced or withheld, regardless of financial performance.
Accountable Persons designated under the Australian Financial Accountability Regime SHALL have a minimum of forty percent of their variable remuneration deferred for at least four years. The bank SHALL maintain a deferral register recording the status of all deferred amounts, vesting schedules, and any adjustments applied.
The bank SHALL maintain and enforce clawback provisions over variable and deferred remuneration for a period of seven years from the date of payment or vesting. Clawback SHALL be triggered in cases of material risk management failure, significant misconduct, material misstatement of financial results, or regulatory sanction. The General Counsel SHALL be consulted before any clawback determination is finalised.
Remuneration structures SHALL not create incentives for staff in customer-facing roles to recommend, promote, or sell products that are unsuitable for the customer's needs. Sales incentives and referral bonuses SHALL be reviewed annually by the Risk function and SHALL require Chief Risk Officer sign-off before implementation.
The bank SHALL conduct an annual gender pay gap analysis and SHALL publish the results in its remuneration report. Where unjustified pay gaps are identified, a time-bound remediation plan SHALL be approved by RemCo and implemented within twelve months.
Total remuneration for all employees SHALL be benchmarked against an approved peer group at least every two years. The outcomes of the benchmarking exercise SHALL be reported to RemCo and used to inform annual salary review decisions.
Satisfying modules¶
(No modules assigned yet — manual process)
Part of People & Culture · Governance overview
Compiled 2026-05-22 from source/entities/policies/PPL-002.yaml