Financial services HR leaders focus on risk and pay
Two-fifths of senior human resources professionals from the financial services industry identified risk adjustments to financials or incentive pools as the most expected shift in pay policies in the next 12 months, according to a Towers Watson poll.
The shift represents a stronger focus on pay issues rather than other changes, such as linkage of deferred vehicles to business unit performance (16%) or longer vesting periods (15%). The poll also indicated a low level of interest by this group in the introduction of new deferral vehicles such as "CoCos" (7%).
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More than a third of respondents viewed pay issues as the most important HR priority, followed by talent acquisition (23%) and the redesign of the employee value proposition or “deal“ (20%). In addition, two-thirds of the group believe that public officer executive base salary levels have not yet stabilised, while there was general agreement that base salary levels for lower-level employees have stabilised.
Mark Shelton, global co-lead of Towers Watson's Talent & Rewards Financial Services Practice said: “Global financial institutions face many issues that connect human capital challenges across pay, performance, risk, regulation, culture and governance. Given the dramatic evolution of pay policies and structures, sufficient linkage to other human capital priorities such as talent management, risk culture and engagement are essential.”
The poll showed that the group was equivocal about the likelihood of regulators increasing the degree of global co-ordination in approaching industry regulation, with just over half believing they would.
A final word
“The financial services industry is beginning to reshape itself in response to altered business environments and strategies. Many of these organisations need to fundamentally align their talent management and workforce practices to shifts in the business environment. Top of mind will be pay strategies that reinforce the desired culture; ensure market competitiveness; differentiate among people’s roles, skills and performance; and deliver the right employee behaviours at a cost the organisation can afford.” - Chris Fabro, global co-lead of Towers Watson’s Talent & Rewards Financial Services Practice.
Want to know more?
Survey details: The poll, conducted at a Towers Watson conference in London last week, involved 130 senior human resources professionals (from over 60 of the largest global banking and financial services organisations in the world).
Availability: To contact Towers Watson, visit www.towerswatson.com/united-states/contact/.
Towers Watson is a “leading global professional services company that helps organisations improve performance through effective people, risk and financial management”. The company offers solutions in the areas of employee benefits, talent management, rewards, and risk and capital management. Towers Watson has 14,000 associates around the world. It’s located on the web at www.towerswatson.com.
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