Incentive frameworks and the outcomes they generate can be powerful indicators of an organisation’s culture. The interlinked nature of incentives means that they, in turn, can also significantly influence culture. These observations were among the key lessons learnt from the Global Financial Crisis, which led financial sector regulators to subsequently introduce regulations over executive remuneration.
At Rhizome we believe getting incentive structures right is critical to the long term sustainability of financial institutions. Understanding and actively managing all key aspects of incentives is crucial to ensure incentives are producing the intended outcomes. These include remuneration design and policy, actual remuneration outcomes, performance assessment frameworks, promotion outcomes, consequence management, bonus pool settings, valuation methodologies and Board Remuneration Committee oversight.
We help financial institutions assess the effectiveness of their incentive frameworks. Utilising our cross-dimensional skillset spanning governance, risk management, accountability and behavioural expertise, Rhizome is able to deliver new insights on whether incentive frameworks are producing their intended outcomes.