Banking Bonuses are the subject of much public and private conjecture year in year out, but never more so than now when “publicly owned banks” are highlighted so visibly in the press regarding the need for restrictions around “Bonus Culture”.
The subject intrigues me every time it comes up, I personally do not think it is too complicated or is my view of The World far too simplistic?
Right or Wrong?
Surely you should never reward failure as it creates the wrong behaviours, no one should ever expect a bonus and it must always be intrinsically linked to success & delivery? However (I know just what you are thinking, he cannot make up his mind!) if you are an integral cog in the bigger corporate wheel and you are personally excelling at your role, delivering what you should but the business as a whole is not, then you could feel a little (or a lot) aggrieved?
I also feel banking bonuses are a good thing if implemented properly, it rewards success and encourages the right behaviours, competition and in the majority of cases economic market forces dictate what they should be i.e. basic economics of supply & demand.
Perhaps the responsibility lies with the “educated shareholder” and the executive committee around corporate pay and governance? However be warned, if you have superstars in your business and you are not rewarding them in-line with the market (they will of course be fully aware of their commercial worth), they are then fare game to be head-hunted. If the discrepancy is a meaningful divide then it would be an easy decision for any individual to move companies, wouldn’t it?
Will it ever end?
So on reflection this is not such a simple debate, but one that will roll on and on where opinions will differ, debated and discussed in many a pub, coffee shop and over dinner etc… One thing is for certain, there will never be a definitive answer or 100% agreement.
Therefore if your bonus was not in-line with expectations or you are looking for a new contract or career opportunity please contact me.