What to do with top bankers that are responsible for financial mismanagement? Make them punishable by law, with a maximum of six years in prison. Or make top executives personally responsible and force them to surrender their bonuses. Doing this would need a change of law.

This is the wish of Dutch left wing politician Ewout Irrgang.

His proposal to make them punishable by law, however, didn’t get much support in the Dutch house of representatives. A pity, says Irrgang, because it is currently near impossible to bring failing bankers to justice.

Headquarters
The suggestion to have bankers cover any damages that they are responsible for out of their own pocket did get support. At least, in principle, since the details of the plan are not fully worked out yet. Reason for the Dutch right-wing party PVV to have their reservations, as well as the Dutch labour party: “We should be careful not to scare big multinationals from having their headquarters in the Netherlands.”

G20
Dutch politicians’ plans in many ways exceed the plans made by the members of the G20. During the recent G20 summit in Pittsburgh, no agreements were reached on the personal accountability of bankers.

They did decide to allow supervisory boards to reclaim bonuses. They also put a stop to bonuses that are guaranteed over multiple years without any performance targets. Lastly, the budget for bonuses is capped whenever the financial stability of the bank is at risk. However, there won’t be a general maximum for bonuses.

What do you think?
What do you think? Should bankers be made personally responsible for any financial failures? Can bonuses that have been awarded under the current, often vague, laws be revoked? And should there be a maximum to bonuses?