Remuneration with Joel Rethore

In late 2015 Governance Evaluator did its annual benchmark report for the Health and Community Sector. The report highlighted 7 key areas requiring capability building, which will form our series of discussions in 2016:

• Strategic Insight
• Risk Tolerance and Appetite
• Service Quality and Clinical Governance
• Key Stakeholder Engagement
• Ongoing Review and Development
• Remuneration
• Directors Roles and Responsibilities

Kicking off the 2016 capability building series is Remuneration with Joel Rethore, Principal of Aon Hewitt, who has prepared the following insights prior to being our guest presenter for the March webinar – enjoy and please comment.

Positively engaged board members, ambitious executives and happy staff, it all sounds too good to be true – right? Not exactly, Implementing a robust remuneration strategy might just be the answer.

Building the case for a clear remuneration strategy and policy

Mitigate risk in your workforce by ensuring your people are paid the right amount, and in the right way to drive the right performance. Realise untapped potential of your employees by raising their performance through optimising their total rewards.

Many companies are experiencing a disconnect between the company’s productivity and profit growth and the relatively flat increase in wages for the majority of workers… less than half of global employees think they are paid fairly for what they contribute.

Aon’s 2015 Trends in Global Employee Engagement Survey

Definition and key elements of engagement

The slide below highlights the 6 key drivers for engagement globally: performance, rewards & recognition is one

The next slide highlights that employee engagement increases if there is an organisational wide strategy for increasing wages in a fixed and competitive way. There is a relationship between effort and reward – not random increases.

The slide below speaks for its self – in anything – if things are perceived to be fair then people are satisfied and more engaged

The last slide shows how management’s ability to explain the organisational wide remuneration strategy also increases engagement. This would be providing the remuneration strategy they describe has a fixed competitive element (reward for effort) and that it is perceived to be fair across the organisation, from the Board to staff.