Goldman Sachs Group Inc., derided for allocating $16.7 billion to pay employees after a bailout by taxpayers, said its top 30 executives will get year-end bonuses in stock they can’t sell for five years.

The awards will be comprised of so-called shares-at-risk, allowing goldman sachs to repossess them if the firm determines that the executive failed to adequately analyze or raise concern about risks, the New York-based company said in a statement today. goldman sachs will also give shareholders a non-binding vote on compensation.

“They’re trying to take the heat off the very large amounts of compensation they’re going to pay,” said Alan Johnson, president and founder of compensation consultant Johnson Associates Inc. in new york. The tactic may not work because the public will focus on the dollar value of the bonuses, which may not be reduced by today’s change, he said.

Goldman Sachs, the most profitable securities firm in wall street history, has been criticized for allocating a near-record amount to pay employees in the first nine months of 2009 after benefiting from government support last year. The new policy will apply to the 30 members of Goldman Sachs’s management committee, including Chairman and Chief Executive Officer lloyd blankfein, Chief Financial Officer David Viniar and the leaders of the firm’s global and regional divisions.

‘Populist Movement’

“It’s been done to address the populist movement that has put so much pressure on the financials over the last year,” said William Fitzpatrick, an analyst at Racine, Wisconsin-based Optique Capital Management, which oversees about $900 million, including goldman sachs shares. “As a shareholder, I view this very favorably. This better aligns our interests with theirs as a management team.”

Two-thirds of Americans say they have an unfavorable view of financial executives and more than half say big financial companies are only out to enrich themselves, according to a Bloomberg National Poll conducted Dec. 3-7. The size of Goldman Sachs’s pay has been criticized by politicians including Senator Jon Tester, a Democrat from Montana, and Senator Bernard Sanders, an Independent from Vermont.

Goldman Sachs, which had 31,700 employees as of September, set a Wall Street pay record in 2007 when it set aside $20.2 billion for compensation, including $16.9 billion in the first nine months. Blankfein, 55, was awarded a $67.9 million bonus that year, an all-time high for a securities firm CEO. It included $26.8 million in cash and $41.1 million in restricted stock and options.

Vesting Period

The new shares-at-risk will be treated like restricted stock and will vest in equal portions over three years, although employees won’t be allowed to sell them for five years, said Lucas van Praag, a spokesman. goldman sachs recognizes the expense of stock awards when they vest, he said.

Johnson at Johnson Associates doesn’t expect competitors to follow Goldman Sachs’s example. “Certainly they’re going to consider it, but I think at the end of the day, most won’t do it, because I think they’re not going to pay as much as goldman sachs,” he said.

The announcement came a day after Chancellor of the Exchequer Alistair Darling said the U.K. will require banks to pay a 50 percent tax on any bonus to employees for 2009 that exceeds 25,000 pounds ($40,672). Six of the 30 members of Goldman Sachs’s management committee are based in the U.K.

Geithner’s Call

U.S. Treasury Secretary Timothy Geithner, in an interview with Bloomberg Television last week, called for an end to “an era of irresponsibly high bonuses” and called for “fundamental constraints on how senior executives are paid” at big banks.

Goldman Sachs’s “announcement makes it much more difficult for Congress or the administration to impose a one-off tax on Goldman or others,” said Michael W. Robinson, a senior vice president of Levick Strategic Communications and former head of public affairs at the Securities and Exchange Commission. “These are the best practices that corporate governance advocates have been calling for.”

In today’s statement, Blankfein said “we believe our compensation policies are the strongest in our industry and ensure that compensation accurately reflects the firm’s performance and incentivizes behavior that is in the public’s and our shareholders’ best interests.”

Management Committee

By limiting the bonus restrictions to management committee members, goldman sachs will remain free to pay cash bonuses to the traders, bankers and sales people who generate the revenue, said Optique’s Fitzpatrick.

“I would want to make sure those folks are compensated in line with market conditions,” Fitzpatrick said. “It’s more important to protect the producers than the management folks.”

Last year Goldman reported its first quarterly loss as a public company and accepted $10 billion in taxpayer funds from the U.S. Treasury, which it repaid with dividends in June. Blankfein and six of his top deputies agreed to forgo bonuses last year, accepting only their $600,000 cash salaries.

During last year’s crisis, the company also raised $5 billion from Berkshire Hathaway Inc., the company led by billionaire Warren Buffett. As a condition of that deal, Blankfein, Viniar, President Gary Cohn and former Co-President Jon Winkelried are prohibited from selling more than 10 percent of their stock until Oct. 1, 2011, or when Berkshire redeems its $5 billion in preferred stock, whichever comes first.

Top Five

The average tenure at goldman sachs of the 30 members of the firm’s management committee is 19 years, according to a presentation to shareholders that goldman sachs published on its Web site. Only the pay of the five top executives, known as the named executive officers, is made public in the firm’s regulatory filings.

Two of Goldman Sachs’s management committee members have recently raised cash by selling stock and exercising options acquired in previous years. J. Michael Evans, the firm’s Hong Kong-based vice chairman, sold $23.7 million of stock during the last week of November, keeping stock worth about $106 million, according to regulatory filings. Michael Sherwood, the firm’s London-based vice chairman, booked a profit of $15.7 million by exercising options on 182,860 shares over eight days from Nov. 13 to Nov. 24, according to regulatory filings.

In addition to stock and option awards, Blankfein has received $91.3 million in cash bonuses and salary over the last five years, while Viniar has taken home $67.8 million in cash over the same period, according to company proxy filings.

One frequent critic of goldman sachs, the Service Employees International Union, wasn’t mollified by today’s announcement.

“Lloyd Blankfein and the rest of Goldman’s executives are still using profits they made off the backs of taxpayers to reward themselves with obscene bonuses,” SEIU Secretary- Treasurer Anna Burger said in an e-mailed statement. “They have done nothing to put people back to work.”

Following is a list of the members of Goldman Sachs’s management committee, which is available on the company’s Web site:

Lloyd C. Blankfein
Gary Cohn
John S. Weinberg
J. Michael Evans
Michael S. Sherwood
Kevin W. Kennedy
Richard A. Friedman
Timothy J. O’Neill
Gregory K. Palm
Masanori Mochida
David A. Viniar
Christopher A. Cole
Esta E. Stecher
David B. Heller
Marc A. Spilker
Edward C. Forst
Richard Gnodde
Richard M. Ruzika
Yoel Zaoui
Gordon E. Dyal
David M. Solomon
Edith W. Cooper
Isabelle Ealet
Edward K. Eisler
Gwen R. Libstag
John F.W. Rogers
Pablo J. Salame
Donald R. Mullen
Harvey M. Schwartz
Alan M. Co