Executive remuneration continues to be a key consideration for Boards and Remuneration Committees in all Australian organisations.
There are a number of fundamental principals which should guide Boards when setting levels of fixed remuneration and determining the structure of incentive plans for executives:
Fixed remuneration needs to be determined through an appropriate job sizing methodology and referenced to a reliable market remuneration database. Important factors such as company size, industry sector, geographic scope of operations and the ownership structure need to be taken into consideration.
Fixed remuneration needs to reflect the executive's contribution.
Boards need to take a considered view of the organisation's target market position. Consistent positioning above the median creates upward pressure in the executive remuneration market.
The structure of short and long term variable incentive plans continue to be the focus of attention. The quantum of variable remuneration and performance drivers are critical issues to address.
Geoff Nunn & Associates specialises in providing independent advice to Boards on Executive Remuneration. We can evaluate your executive roles and provide accurate market remuneration advice. We can also advise on the structure of executive short term incentive plans.
