AIFMD sets out requirements for remuneration policies for senior management, risk takers and staff in control functions.
AIFMD sets out requirements for remuneration policies for key AIF staff.
The Alternative Investment Fund Managers Directive (AIFMD) and its accompanying regulation, supplemented by guidelines issued by European Securities & Markets Authority (ESMA), set out detailed requirements for remuneration policies for senior management, risk takers and staff in control functions. All persons that can exert material influence on the alternative investment fund managers (AIFMs) or alternative investment funds (AIFs) must be included in the remuneration policies. For example, sales persons, individual traders and trading desks.
In summary, the requirements are that:
The requirements apply to external AIFMs, or to the managing body of internally managed AIFs, and identified staff. Also, AIFMs must ensure that delegated entities performing portfolio management or risk management are subject to regulatory requirements on remuneration that are equally as effective as those applicable under the ESMA guidelines, and that contractual arrangements are in place to ensure this.
Mr. Charles Muller
Remuneration is a challenge. Managers need to start considering how their business will be affected by AIFMD remuneration requirements.
KPMG’s global alternative investment practice.