Russia is very behind when it comes to implementing bonus rules

Russia is very behind the rest of the world when it comes to implementing restrictions on investment banking compensation.

This was the verdict of the Financial Stability Board (FSB), which issued a report yesterday looking at how well each country has done at ensuring its bankers are paid sensibly.

Russia falls into a group including Argentina, India, Indonesia and South Africa which were found to have significant gaps in their implementation of rules controlling banking pay in 2011. Since then, the FSB says most countries have made significant improvements - except Russia and Indonesia, where the legislation is still being reviewed and hasn't been implemented yet.

Russia has a few rules that will impact banking pay in Moscow when they're implemented, says the FSB. They include a paper, "On Bank Economic Position Assessment,” which is under review and has a section on pay, a letter on, "The Range of Methodologies for Risk and Performance Alignment of Remuneration," and rules to strengthen the role of compliance staff in dictating bankers' pay.

At the moment, a very high proportion of Russian bankers' pay still comes in the form of bonuses. In the UK, where rules have already been implemented, bonuses are typically a lot lower and a high proportion is deferred over three years or more.