Perhaps she can cash in her bonus account when she leaves, but at a discount. Mr Leggit, who knows that Mr Idiot has fouled up, will prefer to exit quickly with the cash rather than stay to tackle the problems.

I don't see how deferred bonuses can work, but I am not a financier.

There is an interesting article in New Scientist this week about the failure of risk management systems – sophisticated software, first-rate mathematicians and all – to predict the crisis. Many Lehman's staff lost money because they kept their bonus shares rather than diversifying as they could have done.

Maybe 'excessive' bonuses have little to do with the problem?
http://www.newscientist.com/article/mg19926754.20…

If we are going to regulate bonuses I advocate a new tax called The Wossy Windfall Tax, but it would apply to all high earning beeboids and their bonuses, not just Mr Ross

I think the banks should all be 'allowed' to collapse and the "too big to fail" lie, ignored.

Short selling, bonuses, etc is scapegoating.

I think we know the answer to that one.

It is a false problem, led by people such as Darling who used to be redder than red, lest we forget.

Typical politicians: blame everybody else for their own failures and incompetence.

I've worked in quite a few targetted, bonused sales environments before. Setting bonus structures changes the internal economics of the operation, and thus changes staff behaviour.

If business objectives are not achieved, then in my view it is often the fault of the people who were responsible for setting the bonus structure.

I've seen the crazy situation where a communications company's bonus structure valued the 'sale' of a free marketing customer perk the same as the sale of a new 18 month broadband contract. The free perk tooks 20 or 30 seconds to pitch and nearly 100% of punters took it up, whereas the broadband took anywhere from 10 seconds to 10 or more minutes to pitch and sell and less than 5% of punters took it up.

What happened? No-one bothered selling the broadband, it was far more profitable to reduce average handling time by not trying to sell the broadband and concentrating on the smaller, less profitable products. Who's fault was this? In my opinion the person who set the target and bonus structure was to blame. Did anyone blame her? No, it was far easier for everyone concerned to blame the 'data'.

I have heard that a prominent american company in the City (one that is still technically solvent) pays even its most senior executives up to £120,000 as salary. Anything more is paid as bonus.

If as there seems to be a good chance, bonus payments were excessive, the only measure is by results, yes it took ten years but we see the results now, then the share holders must carry the can. At the moment, the system seems to be working as per specification.

I would like to see some sort of a reciprocal bonus clause, the bonus might reasonably be held in escrow for two years, if the company results warrant it, ie. consistently good, then the full bonus should be paid. If the company goes bankrupt like for instance Northern Rock, then there should be a claw back clause.

Unfortunately the power of management has usually been much stronger than the shareholders (who represent a vast number of people and interests). Therefore Government regulation if required should be based around improving the transparency of data on management performance and giving shareholders more control over executive pay and bonus schemes.

Other thoughts – I agree with Guido's comment – but there also needs to be some care taken with this. At Disney, Michael Eisner was paid largely in stock. During his tenure he became one of the largest shareholders. Some of the decisions over his remuneration and the poor performance of Disney towards the end suggest that he was able to abuse his position. So safe-guards from corporate governance need to ensure that management and ownership remain distinct in listed companies.

One other thought – if the Government is forced to intervene or bail out an organisation using public funds, the discretionary bonus pool should be forfeited. That would help align shareholder and management interests. As it is shareholders are losing out disproportionately from bad management.

The problem was with the unnamed, Mr Idiot, who kept or rebought the securitised mortgages back on the books.

Look at the US solution to the problem. Securitise the mortages.

Nick