A proposal for directors of financial institutions to take personal liability for their firm’s losses will be debated in Parliament today.
The private member’s bill has been tabled by all-party Parliamentary group on economics, money and banking chair and Conservative MP Steve Baker (pictured).
It calls for any losses to be “made good” first by directors’ bonuses which should be held back for five years, and then by personal bonds worth £2m or half of the director’s net wealth.
Baker says: “With key decision-makers’ wealth at risk, they could be expected to take responsible decisions instead of expecting rewards for failure. Bankers should bear their own risks and there should never be another taxpayer bailout of a bank. My bill would achieve those aims.”
Money Marketing first reported on the bill last week. It will stand little chance of becoming law if the Government does not back it.