From next year, financial institutions will be able to claw back ‘excessive bonuses’ from senior staff, the justice ministry confirmed on Wednesday.

The upper house of parliament, or senate, on Wednesday accepted draft legislation which centres on bonuses paid out on the basis of wrong information or which are otherwise ‘unjustified’.

Supervisory boards will have the right to amend bonuses and to claw them back if they are higher than acceptable. The boards will also have to justify why bonuses are being paid.

Intervene

‘If a company is in trouble and an executive is awarded an excessive bonus, the board should be able to intervene,’ a finance ministry spokesman told reporters.

The cabinet has also introduced new legislation to limit bonuses to 20% of salary for staff based in the Netherlands.