Public anger has boiled over at the large salaries and immense bonuses awarded to various high-ranking people, some of whom have not performed well. Philippa Lamb discusses issues on executive pay with members of the CIPD Reward Panel - Charles Cotton, John Beadle and Nicki Demby. The CIPD Reward Panel is a panel of professionals, practitioners and academics to support the work of the CIPD in the area of Reward
Philippa asks Charles if he thinks that the criticism of big remuneration packages is justified. See if you agree with his reply.
The connection between pay and perceived performance needs to be re-established, says John. He gives HR a rap over the knuckles here.
Nicki, is asked about pay having been ramped up in the boom years. She thinks that there are unintended consequences in transparency and disclosure of individuals pay. Clarity of communication - in this increasingly complicated area, is agreed to be of paramount importance.
The CIPD has drawn up ten broad principles in consultation with many remuneration specialists including our two speakers. Nicki thinks that although they are excellent guidelines, they must be considered by individual organisations, each relating them to their circumstances and corporate culture. See if you could introduce these in your organisation
HR, John says, must involve itself in pay issues and have the knowledge and courage to formulate the correct pay strategies in their organisations. Remuneration must be seen as essential knowledge for individual HR practitioners a stepping- stone to higher things.
Clawback is a contentious issue. It seems that the design of the process is crucial and that management of it is sometimes a problem.
Philippa wonders how risk and high pay can be balanced. CIPD research is being done on risk, Charles says. With that in mind. Philippa wonders what the biggest changes will be in pay in the future. Nicki thinks the system still works, but needs a more sophisticated approach. Listen to see why. In ten years or so, John thinks that those companies that have had HR at the centre will have come through better.
When she is asked about trends, Nicki looks towards career shares as being the way to go, but fears the cookie cutter approach.
Related useful information
The CIPD runs quite a few short courses on remuneration.
The CIPD runs the Advanced certificate in reward management, see if this would be helpful to you.
CIPD's subject area for pay called Pay and reward: highlighted resources.
Our Tool called Reward strategy: how to develop a reward strategy is available to members, but there is a good explanation of the contents and how they might help you.
We can email you a list of books on topics including understanding pay, strategic pay, pay or performance. You can borrow books from us at a minimal cost. Give our helplines a call on 020 8612 6210.
You can also browse the online journals on similar keywords or favourite authors for free articles on aspects of pay. Any problems phone our helplines on the number above.
Don't forget you can discuss any thoughts arising from the podcast on the Communities website at: www.cipd.co.uk/communities
Explanation of terms used:
Tall poppy syndrome the tendency to be envious of those perceived to be superior to others in some way.
REMCO Remuneration Committee
Cookie-cutter approach not creative, same as before.
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