British Prime Minister Gordon Brown today pledged action to crack down on excessive bonuses for bankers as part of international efforts, a key issue at this month's G20 meeting.
But Brown was unenthusiastic about France's proposal for a mandatory cap on bonuses in the wake of the financial crisis, saying it would be difficult to enforce, according to an interview with the Financial Times newspaper.
French President Nicolas Sarkozy has said he would call for limits on bonuses for bank executives when he takes his campaign for greater regulation to the G20 summit in Pittsburgh on September 24-25.
France and Germany want the European Union to agree on a common position on financial regulation ahead of the G20 summit.
Brown said pay and bonuses should be based on long-term success, not short-term speculative gain, and banks should 'claw back' rewards for bankers if their performance suffered in subsequent years.
He also said regulators should be able to impose higher capital requirements on financial institutions, according to the FT.
Brown, praised for his leadership at the G20 in London, stressed international cooperation on such issues was crucial. Excessive risk-taking, resulting in massive bonuses for bankers, has been blamed for helping spark the global financial crisis that led to multi-billion dollar government bailouts of world banks.
Brown said he hoped leaders in Pittsburgh would agree a 'global compact for growth' including coordinated steps to withdraw stimulus packages and government support for banks.
He also wanted to see a deal on trigger points where countries would be expected to act to address imbalances such as excessive current account deficits and surpluses.
