Government regulators could prohibit incentive-based pay packages at large U.S. financial institutions that encourage inappropriate risks under a bill approved on Friday by the U.S. House of Representatives.
Heading next to the Senate, where its outlook is uncertain, the bill would also give shareholders in public corporations the right to cast annual, non-binding votes on executive pay, giving them a louder, but largely symbolic say on pay.
The House Democrats' bill, part of a broad push to tighten banking and market regulation, would also impose new standards on corporate compensation committees and compensation consultants, requiring them to be independent of managers.
Financial institutions with assets of less than $1 billion would be exempted from the regulation on incentive-based pay.
(Reporting by Kevin Drawbaugh; Editing by Leslie Adler)