Compensation practices at large financial institutions were a key contributing factor to the global financial crisis. The FSB Principles for Sound Compensation Practices and their Implementation Standards (P&S) were developed to align compensation with prudent risk-taking, particularly at significant financial institutions; importantly, they are not intended to prescribe particular designs or levels of individual compensation. This peer review finds that relevant authorities and firms in FSB member jurisdictions have made good progress in implementing the P&S – many national authorities have taken the necessary regulatory actions, supervisory oversight has intensified, and the governance of compensation schemes at firms has improved. Despite these considerable strides, more work is necessary to achieve sound compensation practices – both to overcome constraints to full implementation by individual national authorities and to address concerns at the firm level over an uneven playing field in the market for highly skilled employees. Achieving lasting change in behaviour and culture within firms is a long-term challenge, and requires ongoing monitoring of the implementation of the P&S.