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But it has watered down its proposed code on pay, which will now not be compulsory for big banks in London.
The dispute is an embarrassment for the government as it tries to head off claims that it has watered down its commitment to green causes, now that it is not under pressure from the pro-green Lib Dems.
However, the regulator's critics argue that it has watered down proposals to tackle excessive pay.
Yet time after time, on health care and in higher education, it has watered down such early ambitions.
It has watered down standards and deprived regulatory agencies of the resources they need to do their jobs.
It has watered down environmental legislation and suppressed scientific research that chronicles the environmental toll taken by Alberta's tar sands development.
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By the time the watchdog published its final report five months ago, however, it had watered down its criticisms and limited the recommended price limit to customers on prepayment meters.
The political battle over policing reform is also still raging, with the nationalist SDLP refusing to nominate representatives to the new police board because it feels the legislation has watered down Chris Patten's recommendations.
Later, the tattooist whispers that he has watered down the ink, out of family loyalty.
Furious lobbying seems to have watered down that proposal.
Minnesota and Colorado have watered down pension cost-of-living increases; both have been sued.
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