Despite their popularity, pay-for-performance incentives haven't worked as well as proponents had expected. Research by Alexander Pepper, of the London School of Economics, identifies four reasons why: (1) Executives are more risk-adverse than financial theory suggests, so they don't see the at-risk portion of their pay packages as very valuable. (2) They discount heavily for time, so they don't assign much worth to long-term incentives. (3) They care more about relative pay--creating an arms-race mentality that drives packages higher. (4) Pay packages undervalue intrinsic, nonmonetary motivations to work--and many executives would happily take less pay in exchange for a job that was better in other respects. What should companies do in response to these findings? Pepper suggests, among other steps, eliminating long-term incentive pay, raising salaries, and using annual cash bonuses to encourage desired behaviors. "You can pay executives considerably less in total--but do it in a different way," he says.

【書誌情報】

ページ数：3ページ

サイズ：A4

商品番号：HBSP-F1610A

発行日：2016/10/1

登録日：2016/9/21