WILMINGTON, DE — Financial services firms are facing mounting challenges managing executive compensation programs as participation expands, regulatory scrutiny increases and legacy technology systems struggle to handle growing administrative demands, according to new research from CSC.
The survey of 300 senior human resources, rewards and compensation executives across North America, Europe and Asia-Pacific found that 89% believe their internal technology platforms cannot keep pace with the complexity of modern compensation programs.
The findings highlight operational pressures emerging as firms broaden long-term incentive plans beyond top executives and into larger portions of their workforce.
According to the study, 80% of respondents reported increased participation in compensation programs during the past three years, while 86% described administration of those programs as complex.
The expansion comes as financial institutions face heightened reporting and governance requirements. Half of respondents indicated their organizations are preparing for transparency reviews and regulatory consultations scheduled for 2026.
“Participation in LTI schemes is widening, and expectations around fairness and transparency are increasing,” said Shane Hugill, head of executive compensation services at CSC. “Many are managing programs across multiple providers and jurisdictions, which can make it harder to keep data consistent and processes under control.”
Data management emerged as a significant concern.
Two-thirds of respondents cited reliance on multiple service providers as a major obstacle to maintaining accurate compensation data, while 64% pointed to challenges associated with operating across multiple regulatory regimes.
The fragmentation can increase the risk of reporting errors, compliance failures and inconsistent recordkeeping, according to the survey.
The research also found that 77% of firms now rely on multiple outsourcing partners to administer compensation programs across jurisdictions, reflecting a growing trend toward external administration as plans become more complex.
Jennifer Kenton, CSC’s chief commercial officer, said firms are increasingly redesigning compensation structures as competition for talent intensifies.
“As the labor market becomes increasingly competitive, firms have to think more creatively about how they reward and retain top talent,” Kenton said.
The report focused on organizations operating in private markets, asset management, insurance and investment banking.
The findings were published in CSC’s report, The Future of Reward in Financial Services: Executive Compensation in 2026, which examines how firms are adapting compensation strategies amid evolving regulatory and operational demands.
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