Institutions' remuneration policies for staff members whose professional activities have material impact on the institutions' risk profile shall ensure that remuneration is consistent with sound and effective risk management and provides an incentive for prudent and sustainable risk taking. The requirements set out in the Capital Requirements Directive (CRD) are complemented by more detailed Guidelines on Remuneration Policies. Guidelines on Remuneration Policies and Practices were initially published by the Committee of European Banking Supervisors (CEBS). The EBA will review and update those Guidelines in light of the requirements laid down in the revised CRD. The EBA will submit draft regulatory standards to the European Commission as mandated by the CRD, with respect to the criteria for identifying risk takers and additional tier-1, tier-2 and other instruments which can be used for paying variable remuneration.

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