Aus der Reihe: e-fellows.net stipendiaten-wissen: Band 1164 Behavioral Issues in Corporate Governance. Are Performance Based Payments Useful? (PDF)

Studienarbeit aus dem Jahr 2012 im Fachbereich Führung und Personal - Sonstiges, Note: 1,70, Ruhr-Universität Bochum, Veranstaltung: Contemporary Issues in Corporate Governance, Sprache: Deutsch, Abstract: Various forms of performance based payments are not new phenomena. The discussion on it has existed for a long time. However, as a result of widespread established share-based income components, which were widely reported in the media, this subject shifted it increasingly in the public interest. Especially in the years after the financial crisis it has becomes a common question why the executives of banks got millions of dollars over a long time even though the corporations have to accept government aid today. Furthermore it should be noted that "[c]ompensation policy is one of the most important factors in an organization's success."

In this context this paper discusses issues of current political, social and scientific interest while they are at the same time important for the economy. It will show arguments for and against the paradigm of pay for performance. Additionally, it will try in aspect to give a satisfactory answer to the question, whether performance based payments are useful. This paper will not show special cases of performance-related pay (PRP) systems in the healthcare or in the public sector even though some of the arguments are transferable to them. The focus is on performance-related management compensation and its effects on motivation with some references to performance-based payments for employees. Besides the economic point of view the perspective of psychology will be noted because it seems like these two fields have different opinions on the impacts of monetary incentives.