3 . FLATTENING THE CURVE : IS THE SYSTEM BROKEN ?
“ New , simpler , alternate reward strategies may become more common in the short to medium term ”
— Deloitte , Executive Compensation Report 2020
With this in mind , Deloitte outlined four contributing factors to the complexity of executive compensation with the added context of COVID-19 :
1 . Whilst there is a increased disclosure of information , there is less insight in relation to the complexity of executive compensation
3 . FLATTENING THE CURVE : IS THE SYSTEM BROKEN ?
When it comes to the processes behind executive compensation , Deloitte continues to experience an increase in stakeholders alleging that the process is “ too complicated and needs to be : simplified ; subject to greater regulation ; and more societally orientated .”
In its 2019 report Deloitte discussed the difficulties surrounding the promotion , implementation and policing of pay policies for executives that satisfy the needs of all parties ( shareholders , employees , society and regulators ). “ This often has to be done in a complicated , volatile , ill-informed and sometimes hostile environment ,” commented Deloitte .
2 . Both society and shareholder demands and placing Remuneration Committees in challenging positions
3 . Advice is reliant on surveys for companies and in some instances illconceived benchmark
4 . Visibility of top executive pay to executives has enhanced the demand for executives to be well positioned next to their peers
Ultimately , Deloitte expects to see COVID-19 prompt a re-evaluation of executive pay with an increased demand for simplicity . However , “ much will depend on the progress of COVID- 19 as much as its lasting compact .” While evidence currently shows that
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