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      The introduction of CBUAE (Central Bank of the UAE) Circular No. 5/2026 marks a fundamental shift in how financial institutions design, govern, and manage remuneration frameworks.

      What was once a best practice is now a regulatory obligation, with clear expectations around governance, risk alignment, and accountability.

      The regulation establishes minimum requirements to ensure remuneration is aligned with performance and risk outcomes, and to mitigate risks arising from improper remuneration practices.

      At KPMG, we support financial institutions in moving beyond compliance to build remuneration frameworks that are robust, defensible, and aligned to long-term value creation.

      What this means for your organization

      The regulation introduces new requirements that impact multiple areas across your organization:

      • Board-level accountability for remuneration decisions
      • Formal identification and governance of Material Risk Takers (MRTs)
      • Mandatory deferral, clawback, and risk-adjusted pay structures
      • Enhanced independence of control functions
      • Tight regulatory timelines (180-day gap analysis and 15-month implementation)

      These requirements are designed to ensure that remuneration outcomes are closely linked to performance and risk, while reducing the potential for excessive risk-taking.

      How we can help

      We offer a structured, end-to-end solution to support your compliance journey, from initial assessment through to implementation.

      Understand where you stand today.

      • Article-by-article assessment against CBUAE requirements
      • Identification of gaps across governance, policy, and pay structures
      • Clear prioritization of remediation areas 

      Establish a robust and defensible approach.

      • Design of MRT and Senior MRT identification methodology
      • Alignment with qualitative and quantitative criteria
      • Board-ready documentation and governance processes

      Build a compliant and future-ready structure.

      • Remuneration framework aligned to risk and strategy, ensuring clear linkage between pay, performance, and risk outcomes
      • Variable pay design, including deferrals and performance linkage
      • Malus and clawback mechanisms
      • Policy and contract updates 

      Strengthen oversight and accountability.

      • Remuneration Committee and Risk Committee alignment
      • Control function independence frameworks
      • Board and senior management advisory 

      Deliver within required timelines.

      • 180-day gap analysis report preparation and submission
      • 15-month implementation roadmap
      • Regulatory reporting templates and disclosures 

      Embed sustainable change.

      • Stakeholder alignment and communication
      • Capability building across teams
      • Integration of risk culture into remuneration practices 

      Our approach

      We follow a structured, phased methodology designed to deliver both compliance and long-term value:

      • Diagnose current state
      • Assess against regulatory requirements
      • Design remediation roadmap
      • Support implementation and ongoing compliance 

      Why KPMG

      Our approach goes beyond remuneration.

      We bring together integrated expertise across Reward, Risk, and Governance, providing a coordinated response to a complex regulation.

      • Deep understanding of CBUAE regulatory expectations
      • Proven experience across UAE and GCC financial institutions
      • Practical, implementation-focused solutions
      • Strong board-level advisory capabilities
      • Regional and international benchmarking insights

      We help you build frameworks that stand up to scrutiny and support long-term resilience, with remuneration structures that reinforce responsible behavior and appropriate risk-taking.

      Who we work with

      • Banks
      • Insurance and reinsurance companies
      • Financial services organizations regulated by the CBUAE

      Start your compliance journey

      With regulatory timelines already in motion, early action is critical.

      Connect with our team to assess your readiness and define your path forward.

      Connect with us

      gunjan
      Gunjan Shroff

      Partner, People and Change

      KPMG Middle East

      Tanuj
      Tanuj Srivastava

      Associate Director, People and Change

      KPMG Middle East