Performance-based pay has come under fire since the global financial crisis. And indeed, the evidence does suggest that incentive-based pay can be damaging in many settings. This research is summarized in a recent article from Dan Cable and Freek Vermeulen of London Business School. However, very little of the research they cite was actually conducted on business executives. The research that has been conducted on business leaders suggests that financial incentives can work… and quite often do.
Performance-Based Pay for Executives Still Works
The case for bonuses and stock options.
February 23, 2016