UBS (UBS) is getting medieval with its compensation for top managers, according to CNBC. The bank will give no bonuses this year, and future bonuses will be subject to a severe clawback. If the company reports a loss in any of three years following the bonus, the employees lose the whole.
The company isn’t the first to introduce a clawback mechanism — Morgan Stanley is doing something similar — but this strikes us as the most severe. Make a loss — lose the bonus.