European Union leaders will call on the world's leading economies to
threaten sanctions against banks that pay huge bonuses to their
EU leaders are gathering Thursday seeking a unified position on this and other issues planned for the G20 meeting next week.
A draft EU statement leaked to reporters calls for bonuses to be linked to a company's performance, and would rescind bonuses if the deals that generated the bonuses go sour in the long run.
Some economists say the bonus culture prompted executives to take major risks for short-term profit. Some of these deals turned to massive losses, which threatened the stability of the financial system. Some worried governments used taxpayers' money to keep the firms from collapsing.
France and Germany are calling for caps, on how much bankers can be paid. The U.S. and Britain have so far resisted that approach.
The G20 leaders are set to meet in Pittsburgh on September 24 and 25.
Some information for this report was provided by AP and Reuters.