Banks are failing to rein in excessive payouts for staff below the boardroom level despite a public backlash against a bonus culture blamed for contributing to the financial crisis, say leading investors.
Reuters reports that while higher levels of engagement by shareholders and political pressure since the crisis and the Libor rate-rigging scandal have seen some top executives waive or take smaller bonuses, lower ranks have not been subject to such restraint.
In Britain - a global investment banking hub and home to most of Europe's top-earning bankers - the annual results season has seen a series of banks disclose payments are on the rise, angering some shareholders.
Investors do not have the power to veto the bonuses of staff below boardroom level, but could voice dissatisfaction by voting down directors' own remuneration packages.
'It certainly looks as though previous commitments we received have been abandoned', said one fund manager with stakes in British lenders including Lloyds, Barclays and HSBC. The investor asked not to be named ahead of meetings with the management of banks in which the fund holds shares.
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