Response to consultation Paper on draft Guidelines on the data collection exercise regarding high earners
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For some new categories in the reporting requirements, definitions are not sufficiently clear. For example, ‘independent control function’ is a new category and on interpretation it is possible that staff will fall in this category and in other categories. In this case it is not sufficiently clear in which category these staff should be reported. More generally, detailing information by business area, control function and corporate functions which were previous in an ‘all other functions’ column results in more granular requests which cannot be easily applied, as responses will depend on the specific internal organisation of each and every institution. In this respect, the proposed templates and explanatory texts are not sufficiently clear.
An important aspect of impact analysis is the effect of reporting requirements on the privacy of identified staff. Due to the higher amount of information requested, and the categorisation of this information, there is an increased likelihood that staff will be identifiable from the report (this is particularly the case for high earners). Therefore the impact on the privacy of staff should be reconsidered due to the, surely unintended, prejudicial effect the disclosure of this data would have on the employees concerned.
Q2: Is the information to be submitted to the EBA sufficiently clear?
The highly granular level of data requested in the new templates is unnecessary for the purpose of this data collection. A high proportion of the population covered by this exercise are not material risk takers and therefore do not fall under the provisions of CRDIV. As a consequence, more detailed information requests are neither necessary nor appropriate and comparisons between institutions will not be made easier. A preferable alternative would be to maintain usage of the preceding templates for data collection on high earners and to use data collected in the benchmarking exercise for further analysis of high earners.For some new categories in the reporting requirements, definitions are not sufficiently clear. For example, ‘independent control function’ is a new category and on interpretation it is possible that staff will fall in this category and in other categories. In this case it is not sufficiently clear in which category these staff should be reported. More generally, detailing information by business area, control function and corporate functions which were previous in an ‘all other functions’ column results in more granular requests which cannot be easily applied, as responses will depend on the specific internal organisation of each and every institution. In this respect, the proposed templates and explanatory texts are not sufficiently clear.
Q4: Are the reporting period and the specific amounts to be reported sufficiently clear?
The reporting period and amounts to be reported are mostly sufficiently clear. Point 3.4 regarding “multi-year accrual periods which do not revolve on an annual basis” could be interpreted in differing ways and this should be clarified.Q6: Do you agree with our analysis of the impact of the proposals in this Consultation Paper? If not, can you provide any evidence or data that would explain why you disagree or might further inform our analysis of the likely impacts of the proposals?
The EBF mostly agrees with the impact analysis provided. However, the reporting on high earners should be aligned and possibly merged with the benchmarking exercise. This is because the data collected for both reports are similar. For some institutions, the real costs and administrative burden of updating reporting systems will be high. To avoid non value-adding administrative work, it should be ensured that all competent authorities provide the reporting templates in English.An important aspect of impact analysis is the effect of reporting requirements on the privacy of identified staff. Due to the higher amount of information requested, and the categorisation of this information, there is an increased likelihood that staff will be identifiable from the report (this is particularly the case for high earners). Therefore the impact on the privacy of staff should be reconsidered due to the, surely unintended, prejudicial effect the disclosure of this data would have on the employees concerned.