As talk of a global banker bonus tax swirls…

Goldman get its retaliation in, complete with a neat “recapture” provision.

RTRS-GOLDMAN SACHS ANNOUNCES CHANGES TO 2009 COMPENSATION PROGRAM

RTRS-GOLDMAN SACHS GROUP INC SAYS MANAGEMENT COMMITTEE TO RECEIVE NO CASH BONUS FOR 2009

RTRS-GOLDMAN SACHS GROUP INC SAYS EQUITY “SHARES AT RISK” SUBJECT TO SALES RESTRICTIONS FOR FIVE YEARS

RTRS-GOLDMAN SACHS SAYS SHAREHOLDER TO HAVE ADVISORY VOTE ON COMPENSATION PRINCIPLES AND EXECUTIVE COMPENSATION

And in more detail: (Emphasis ours)

NEW YORK–(BUSINESS WIRE)–The Goldman Sachs Group, Inc. (NYSE: GS) today announced that its Board of Directors has approved changes to compensation for 2009. They include the following:

The firm’s entire 30-person management committee, which comprises all global divisional and regional leadership, will receive 100 percent of their discretionary compensation in the form of Shares at Risk, which are subject to restrictions for five years. Discretionary compensation represents the vast majority of senior management’s compensation and is directly tied to the firm’s overall performance.

Shares at Risk cannot be sold for five years, in addition to other restrictions.

The five-year holding period on Shares at Risk includes an enhanced recapture provision that will permit the firm to recapture the shares in cases where the employee engaged in materially improper risk analysis or failed sufficiently to raise concerns about risks. Enhancing our recapture provision is intended to ensure that our employees are accountable for the future impact of their decisions, to reinforce the importance of risk controls to the firm and to make clear that our compensation practices do not reward taking excessive risk.

The enhanced recapture rights build off an existing clawback mechanism which goes well beyond employee acts of fraud or malfeasance and includes any conduct that is detrimental to the firm, including conduct resulting in a material restatement of the financial statements or material financial harm to the firm or one of its business units.

Shareholders will have an advisory vote on the firm’s compensation principles and the compensation of its named executive officers at the firm’s Annual Meeting of Shareholders in 2010.

The shareholder vote is a real surprise – but remember that a good portion of this firm is owned by Goldmanites themselves. And Warren Buffet.

For the rest, including some comments from Lloyd C. Blankfein, go here.

Related links:
Goldman Sachs – because we’re worth it – FT Alphaville
A global banker tax? (updated with breaking news from France) – FT Alphaville

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