Case | HBS Case Collection | July 2010 (Revised December 2010)

Post-Crisis Compensation at Credit Suisse (A)

by Clayton S. Rose and Aldo Sesia


On October 20, 2009, Brady Dougan, the CEO of Credit Suisse Group, announced a new compensation plan for the bank. The announcement had followed quickly on the heels of the G-20 meeting the prior month where, in the wake of the financial crisis, the major governments had laid out a set of guidelines for compensation in the financial industry. Credit Suisse Group was the first firm to adopt the G-20 guidelines and did so a year ahead of the suggested timetable. While responsive to the concerns of regulators and politicians, Credit Suisse's program was more than a knee-jerk reaction; the new compensation plan had been the result of a "10-year journey" to reshape the culture of the firm. After a significant investment of senior leadership time to explain the new program to employees, a significant new challenge arose. On December 9, the U.K. government announced it would impose a one-time 50% tax on bankers' bonuses greater than £25,000. Dougan and the executive team had to decide how best to fund this tax. Was it fair or appropriate to have the shareholders shoulder the burden of the tax? Similarly, was it fair to ask the U.K. employees to suffer relative to their peers in other countries?

Keywords: Financial Crisis; Globalized Firms and Management; Governing Rules, Regulations, and Reforms; Taxation; Compensation and Benefits; Organizational Culture; Business and Shareholder Relations; Banking Industry; Financial Services Industry; Switzerland; United Kingdom;


Rose, Clayton S., and Aldo Sesia. "Post-Crisis Compensation at Credit Suisse (A)." Harvard Business School Case 311-005, July 2010. (Revised December 2010.)