There has been much coverage in the media recently dealing with the issue of CEO bonuses and whether they should be tied to the wellbeing of the workforce the CEO is responsible for.

In general the criteria for a sound incentive scheme are:

  • The person should be able to influence the outcome
  • The outcome should be accurately measurable
  • The outcome should be something which is in the interest of the organisation and its stakeholders, including staff
  1. Chief Executives can definitely influence the outcomes of engagement survey results. The most effective way to do this is to ensure that the behaviours of all the leaders in the organisation are positive toward their staff.  Key behaviours include supporting staff, empowering them, creating a learning environment and acting with optimism and positivity.  Click here to see a post on the key behaviours of effective leaders. Click here to see how to measure the effectiveness of leader behaviours.
  2. Engagement is easily measurable if you use a valid measure. The most generally accepted measure in the world today is based on the definition of engagement developed by Bakker (2011).  Engagement is a combination of vigour, dedication and absorption of employees in their work. Sadly there are also a great many shonky measures of engagement.
  3. Engagement as defined in point two is an excellent predictor of organisational outcomes such as profit growth, quality and quantity of work, customer satisfaction, staff turnover and employees loving their jobs.

So why not?  I think that rewarding CEOs for their success in developing a psychologically healthier workforce makes sense. It is a classic case of where doing good things for staff leads to good things for the company.  This is a more progressive perspective on leader performance and I think that it is a step forward.

Andrew Marty
Managing Director
SACS

 

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Bakker, A.B. (2011). An evidence-based model of work engagement. Current Directions in Psychological Science, 20, 265-269

 

Andrew Marty
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