CNSP RESOLUTION NO. 476, OF 26 DECEMBER 2024 (*)
Provides for the remuneration policy of insurance companies, open supplementary pension entities - EAPCs, saving bonds companies and local reinsurers.
The PRIVATE INSURANCE SUPERINTENDENCY - SUSEP, using the powers conferred on it by art. 34, item XI, of Decree no. 60.459, of 13 March 1967, hereby announces that the NATIONAL PRIVATE INSURANCE COUNCIL - CNSP, in an ordinary session held on 26 December 2024, based on the provisions of art. 32, item II, of Decree-Law no. 73, of 21 November 1966, in art. 3, par. 1, of Decree-Law no. 261, of 28 February 1967, in arts. 5, 73 and 74 of Complementary Law no. 109, of 29 May 2001, and in art. 5 of Complementary Law no. 126, of 15 January 2007, and considering what is contained in Susep File no. 15414.628529/2023-01, resolves:
CHAPTER I
PURPOSE AND SCOPE
Art. 1. Insurance companies, open supplementary pension entities (EAPCs), saving bonds companies and local reinsurers must establish, in accordance with the provisions of this Resolution, a remuneration policy that includes at least the following senior personnel:
I - administrators;
II - other senior management positions, when not statutory, including at least vice-presidents and directors;
III - key managers in control functions, including at least the heads of the risk management, compliance and Internal Audit units; and
IV - other managers whose actions, in the assessment of the supervised company, may have a material impact on the supervised company's exposure to risks.
Sole Paragraph. The provisions of this Resolution do not apply to supervised companies in the S4 segment.
CHAPTER II
DEFINITIONS
Art. 2. For the purposes of this Resolution, the following are considered:
I - supervised companies: insurance companies, EAPCs, saving bonds companies and local reinsurers;
II - administrators: statutory directors and members of the Board of Directors;
III - remuneration: amounts paid by the supervised company to its employees, in cash, shares, share-based instruments or other assets, as a form of retribution for the work done;
IV - fixed remuneration: part of the remuneration whose value is pre-fixed, comprising fixed salary or pro-labour, compulsory bonuses, bonuses, including for the exercise of function, among others;
V - variable remuneration: part of the remuneration whose value is post-fixed according to performance or the achievement of targets, at an individual or corporate level;
VI - short-term incentives - ICP: part of the variable remuneration whose value is fully paid or transferred within one year of the end of the period considered for its calculation, including profit or income sharing (PLR), bonuses, commissions, among others;
VII - long-term incentives - ILP: part of the variable remuneration whose value is fully paid or transferred more than one year after the end of the period considered for its calculation, comprising deferred bonuses, granting of shares or options, phantom stock, among others; and
VIII - vesting: the process by which the supervised company becomes obliged to make the payment of a certain remuneration or the transfer of assets relating to remuneration, or by which the assets attributed to the beneficiaries are released from lock-up or other restrictions on trading, upon fulfilment of conditions such as the lapse of time or the achievement of targets.
Sole Paragraph. For the purposes of items III to VII of the heading, the following shall not be considered as remuneration:
I - benefit plans, except for any contributions to supplementary pension plans that fall under the provisions of item V of the heading;
II - daily travel allowances, reimbursement of expenses and other payments of an indemnity nature;
III - contributions to Social Security and the Severance Fund for Length of Service (FGTS);
IV - rewards and allowances; and
V - "in natura benefits regularly provided, such as food, housing or clothing.
CHAPTER III
REMUNERATION POLICY
Section I
General Requirements
Art. 3. The remuneration policy should contribute to:
I - the effectiveness of risk management and compliance with the risk appetite and risk management policy, especially with regard to the exposure limits established therein;
II - the effectiveness of capital management and compliance with the capital contingency plan, especially in terms of the control levels established therein;
III - the effectiveness of internal controls and compliance with the compliance policy;
IV - compliance with the sustainability policy and the institutional conduct policy;
V - the generation of long-term value; and
VI - attracting and retaining qualified and experienced professionals.
Sole Paragraph. Item II of the heading does not apply to supervised companies in the S3 segment.
Art. 4. The variable remuneration, whenever practised, must:
I - consider the suitability of the types of remuneration used for the objectives listed in art. 3 and the employee's level of responsibility;
II - consider performance at the individual, unit and supervised company levels as a whole; and
III - have risk adjustment mechanisms, which make it possible to reduce it in proportion to the financial and non-financial risks assumed and adverse risk results.
Sole Paragraph. The risk adjustment mechanisms referred to in item III of the heading must provide for cases in which the value of the instalments not yet paid or transferred can be reduced to zero, and, in the specific case of administrators, may also include the refund of instalments already paid or transferred, in compliance with the legislation in force and the applicable contractual provisions.
Art. 5. The variable remuneration of the director responsible for internal controls and the managers listed in art. 1, item III, may not be linked to the financial performance of units they control or evaluate, such as those carrying out activities directly related to the business.
Art. 6. The provisions of arts. 4 and 5 do not apply:
I - to PLR, as referred to in Law 10.101 of 19 December 2000, and to other forms of variable remuneration defined in collective-bargaining agreements; and
II - sales commissions, as referred to in Law 3.207 of 18 July 1957, if any.
Section II
Long-Term Incentives - ILP
Art. 7. Variable remuneration must include a portion of ILP, deferred for future payment, the amount of which corresponds to at least the lower of the following values:
I - percentage of the total variable remuneration calculated in the year, proportional to the employee's level of responsibility, which may not be less than 40 per cent; and
II - the difference between the total variable remuneration calculated for the year and its components mentioned in the items in art. 6.
Paragraph 1. The provisions of this article do not apply when the amount calculated in the caput is less than three times the fixed monthly remuneration.
Paragraph 2. The deferral period must be compatible with the time horizon of the risks assumed, and may not be less than three years.
Paragraph 3. Payments must be made in stages, in instalments proportional to the length of the deferral period or the risks assumed, whichever results in the lowest value.
Paragraph 4. Advance payment of the instalments referred to in par. 3 is forbidden, including in the event of the employee's dismissal, subject to the provisions of labour legislation, where applicable.
Art. 8. At least 50% (fifty per cent) of the ILP must be paid in shares, or share-based instruments, of the supervised company, when it is a publicly traded company.
Paragraph 1. In the event provided for in this article, the provisions of art. 7, par. 2 and 3 must be guaranteed by means of mechanisms such as shares vesting or option exercise periods.
Paragraph 2. The supervised company must, through express provisions in its compliance policy or code of ethics and conduct, prohibit its employees from using capital market derivative instruments that are capable of altering the effects of the price variations of the shares or share-based instruments mentioned in this article.
Art. 9. For supervised companies that do not have shares traded on the market, ILPs may include:
I - payments in kind with reference to the book value of the supervised company's shares, resulting from dividing its net worth by the total number of shares, provided that the effects of transactions with shareholders, unrealised profits and non-recurring events controllable by the supervised company are deducted; or
II - shares, or share-based instruments, of the direct or indirect parent company of the supervised company, when it is a publicly traded company, subject to:
a) assessment by the supervised company of its effective capacity to contribute to the objectives listed in art. 3; and
b) compliance with the provisions of art. 8, par. 1 and 2.
Section III
Formalisation and Communication
Art. 10. The remuneration policy must be formally documented in writing, containing clear and verifiable provisions, at least as regards to:
I - the types of fixed and variable remuneration practised and the senior personnel to whom they apply, defining the respective criteria for payment, risk adjustment, deferral and vesting;
II - criteria for identifying managers who fall under items III and IV of art. 1, based on hierarchical level, limit of authority or other similar parameters; and
III - criteria and guidelines for negotiating payments and payment guarantees in the event of an agreement preventing an employee from carrying out another remunerated activity for a fixed term.
Sole Paragraph. The document referred to in the heading must be:
I - approved by the Board of Directors or, if none exists, by the General Meeting;
II - reassessed at least every two years; and
III - disclosed to all employees of the supervised company, using clear and accessible language.
Art. 11. At least the following must be disclosed to the external public by 30 April of each financial year, in an easily identifiable place on the website of the supervised company or the group or conglomerate to which it belongs:
I - qualitative information on the remuneration policy; and
II - the consolidated amounts paid in the previous financial year, as well as estimates of the amounts to be paid in the current financial year and subsequent years, by way of:
a) ICP;
b) ILP; and
c) exceptional payments referred to in art. 17.
CHAPTER IV
GOVERNANCE OF THE REMUNERATION POLICY
Art. 12. It is the responsibility of the Board of Directors or, if there is none, the Executive Board of the supervised company:
I - ensuring the suitability and effectiveness of the remuneration policy, promoting its compatibility with the policies mentioned in art. 3; and
II - approve, at least annually, the amounts to be paid to the employees listed in art. 1, items II to IV, including variable remuneration.
Art. 13. The supervised company must set up a Remuneration Committee, directly linked to the body referred to in art. 12, in order to assist it in carrying out its duties relating to the remuneration policy, which shall at least be responsible for:
I - draw up the remuneration policy, proposing fixed and variable remuneration mechanisms, as well as benefits and special recruitment and dismissal programmes;
II - supervising the implementation and operationalisation of the remuneration policy;
III - periodically evaluate the remuneration policy, particularly in terms of:
a) its contribution to the objectives set out in art. 3;
b) its compliance with the provisions of this Resolution and applicable legislation; and
c) significant discrepancies in relation to similar companies;
IV - review the remuneration policy, formulating and evaluating proposals for changes; and
V - propose the amounts
a) referred to in art. 12, item II; and
b) the overall or individual remuneration of directors, as referred to in art. 152 of Law 6,404 of 15 December 1976, for approval by the General Meeting.
Paragraph 1. Supervised companies in the S3 segment are exempt from setting up a Remuneration Committee.
Paragraph 2. In supervised companies in the S2 segment, the duties of the Remuneration Committee may be assumed by another committee that complies with the provisions of this Resolution, provided that:
I - the committee does not accumulate more than two assignments provided for in the regulations in force; and
II - the body referred to in art. 12 ensures that the accumulation of duties, as provided for in this article, does not compromise the integrity and effectiveness of each of them individually.
Paragraph 3. The Remuneration Committee's recommendations within the scope of the duties set out in the heading, as well as the respective analyses on which they are based, must be recorded in writing.
Art. 14. The Remuneration Committee, when applicable, must be made up of at least three members who have the qualifications and experience necessary to exercise competent judgement on the remuneration policy, the majority of whom:
I - is not an employee mentioned in art. 1, except in the exclusive capacity of member of the Board of Directors, nor their spouse, partner or relative in a direct, collateral or affinity line, up to the third degree;
II - has a maximum term of office, or consecutive terms of office, on the Remuneration Committee limited to ten years, with a minimum interval of three years for reinstatement; and
III - is not a member of other committees provided for in the regulations in force, with the exception of the hypothesis provided for in art. 13, par. 2.
Paragraph 1. The Remuneration Committee must be chaired by a member who fulfils the requirements set out in the items of the headings.
Paragraph 2. The composition and operating rules of the Remuneration Committee, including the number of members, their minimum qualifications and term of office must be set out in the committee's internal regulations, approved by the Board of Directors or, if none exists, by the General Meeting.
Art. 15. The compliance and risk management units, within the scope of their respective duties, are responsible for:
I - providing the information required to define the risk adjustments referred to in art. 4, item III, and, where applicable, the deferral period for ILPs, in accordance with art. 7, par. 2 and 3; and
II - in the event provided for in art. 13, par. 1, periodically assess the remuneration policy in terms of its contribution to the objectives set out in art. 3, Items I and III, formulating proposals for changes if necessary.
CHAPTER V
TRANSITIONAL AND FINAL PROVISIONS
Art. 16. In the case of supervised companies served by a unified SCI/EGR (Internal Control System / Risk Management Structure):
I - the Remuneration Committee, when applicable, and the remuneration policy must be unique, established by the supervised company leading the prudential group; and
II - the amounts referred to in art. 11, item II, may be consolidated for all supervised companies and disclosed only by the leading supervised company of the prudential group.
Sole Paragraph. The policy mentioned in item I of the heading must take into account the specifics of the operations of all the supervised companies served by the unified SCI/EGR.
Art. 17. The guarantee of payment of minimum amounts of bonuses or other incentives to employees may only occur on an exceptional basis:
I - when an employee is hired or transferred to another city, limited to the first year after the event that gave rise to it;
II - when the employee leaves the company, in the event of:
a) contractual impediment to exercise another remunerated activity for a fixed term, limited to the period in question; or
b) joining a voluntary redundancy programme; or
III - during the first two years this Resolution is in force, and exclusively for employees subject to the ILP, in accordance with art, 7, in order to smooth the implementation of this part.
Art. 18. The supervised company must keep and maintain at SUSEP's disposal, for a period of five years, under the terms of current regulations, the current and previous versions of the following documents:
I - remuneration policy, referred to in Chapter III, Section III;
II - recommendations of the Remuneration Committee, referred to in art. 13, par. 3;
III - the internal regulations of the Remuneration Committee, as referred to in art. 14, par. 2; and
IV - other documents proving compliance with the provisions of this Resolution.
Art. 19. Susep is hereby authorised to issue complementary rules and guidelines for implementing the provisions of this Resolution.
Art. 20. The following provisions of CNSP Resolution no. 416, of 20 July 2021, are hereby revoked:
I - art. 9, par. 4;
II - art. 10, par. 7, item II;
III - art. 18, item VII and par. 3;
IV - art. 29, par. 3, item IV; and
V - art. 36, item IV.
Art. 21 This Resolution comes into force on 2 January 2026.
Sole Paragraph. Supervised companies in the S2 segment will have until 4 January 2027 to comply with the provisions of art. 3, item II.
ALESSANDRO SERAFIN OCTAVIANI LUIS
Superintendent
(Official Gazette DOU of 27.12.2024 - pages 105 to 106 - Section 1)
(*) The information provided in this publication is general and may not apply to a specific situation or person. Every effort has been made to ensure that matters of concern to readers are covered. Although the information provided is accurate, be advised that this is a developing area. The information contained herein is not intended to be relied upon or to be a substitute for legal advice in relation to particular circumstances. Specific legal advice should always be sought from experienced local advisers. Accordingly, Editora Roncarati accepts no liability for any loss that may arise from reliance upon this publication or the information it contains.
