Performance and Reward

Striking the right balance

With recent Financial Services Royal Commission, shareholder and community interest in remuneration and incentives and their link to performance are at an all time high. And not just at senior leadership levels, but at the “coal face” of an organisation where incentives can drive good or bad behaviour - behaviour that we now know can deeply impact the role of Boards.

Remuneration is also the most tangible outcome for demonstrable accountability. Both financial services and non-financial services companies continue to face increasing pressure on their remuneration frameworks, with regulators seeking to promote stronger risk-alignment and increased accountability.

A key question we are seeing emerge is “what does it mean to remunerate fairly, and how does this align to the full gamut of responsibility?”
In addressing this, organisations are re-examining the role of remuneration in driving excessive risk taking and short term decision making. For example:

  • Is the quantum of executive pay in our organisation too high?
  • Does the balance between fixed and variable, and between short term and long term incentives, support our desired culture?
  • Does our incentive structures promote ethical conduct?
  • Does our reward framework promote high-performance or a ‘win at all costs’ culture?
  • Are Committees receiving appropriately detailed information to allow for sufficient challenge of remuneration outcomes?

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Contact us

Andrew Curcio

Partner, People and Organisation, PwC Australia

Tel: +61 3 8603 1685

Emma Grogan

Partner, People and Organisation, PwC Australia

Tel: +61 (2) 8266 2420

Peter van Dongen

Chairman, PwC Australia

Tel: +61 (2) 8266 3378

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