Europe’s largest bank has invited shareholders to vote on proposals that would limit the maximum bonus and long-term incentive plan share payouts to 10 times basic salary, from 12 times.

The plan also makes it harder for employees to cash in quickly on rewards, prolonging the vesting period for share awards from three to five years and crucially making staff hold onto these shares until they retire or leave the bank.

“We believe these proposals will lead the way on better alignment of employee incentivization with strategy and long-term sustainable value creation for shareholders,” HSBC said in a statement.

Awards can also be clawed back, in line with regulatory requirements on pay being imposed across Europe.

HSBC has no plans to impose a limit on salary levels.

The new plan puts a tighter cap on the value of potential share awards granted as part of a long-term incentive plan, restricting these to six times salary from seven times.

Bonus payouts, made in shares and cash, would be capped at three times salary rather than four.

Guy Jubb, head of Governance & Stewardship at UK funds firm Standard Life Investments, one of HSBC’s fiercest critics on pay in recent years, swiftly welcomed the proposals and said they deserved support from other long-term investors.

“It demonstrates that HSBC has taken to heart the lessons from the banking crisis and provides a platform to reward and incentivise prudential and profitable growth,” Jubb said.

HSBC’s proposed changes comes a day after shareholders in BP challenged its remuneration report at its first annual meeting since the Gulf of Mexico oil spill.

Some 11 percent of voting shareholders rejected its pay plans, while a quarter of investors — representing 60 percent of company shares — voted against the re-election of Safety Committee Chair Brian Castell.

Barclays is bracing for a showdown with investors at its meeting later this month after shareholder advisory group PIRC urged investors to oppose its “overly complex” pay plans.

HSBC’s annual general meeting is due to take place on May 27.