The Directive will bring significant changes to the reporting requirements around remuneration for many AIFMs. According to a recent KPMG survey of AIFMS, 45 percent of respondents said they had not yet considered how these new remuneration requirements would impact their businesses. These firms would be well-served to begin the process of developing comprehensive remuneration policies that will not only comply with the Directive, but also promoting sound and effective risk management.
- The remuneration policies of financial institutions remaining high on the political agenda. This is not expected to change soon.
- Remuneration policies need to be consistent with and promote sound and effective risk management.
- KPMG is finding that many AIFMs don’t currently comply with any regulatory remuneration policy.
- The risk profiles of funds need to be aligned with remuneration policies.
- Legal structures of funds can impact this remuneration component.
- How KPMG can help: KPMG member firms can develop a tailored, comprehensive remuneration policy, determine how much reporting and disclosure will be required, assess if there are any potential privacy issues, etc. We will create an improvement roadmap, conduct a gap analysis on requirements, set the stage for well-documented and transparent processes.