Royal Bank of Scotland Group Plc is contemplating a reduction of CEO Ross McEwan's compensation from £3 million to £1.75 million beginning 2017, Sky News reported Dec. 26.

Among proposals discussed with shareholders, McEwan's long-term incentive plan award may be lowered from 300% to 175% of his base pay of £1 million, Sky said.

McEwan, who replaced Stephen Hester in 2013, will reportedly be required to increase his holding of RBS shares to at least 400% of his salary and to hold onto them for at least eight years. Further, he will be entitled to incentive-pay in full even if he quit in the middle of a share award scheme, Sky News said citing "people close to the plans."

RBS's new pay policy will reportedly be put to a binding shareholder vote in the spring of 2017.

However, an RBS spokeswoman denied that any decisions were taken on pay and added that: "We are required to review our pay policy for executive directors every three years and are currently consulting on a number of proposals."