A bonus for ethics is the latest scam in corporate pay
But maybe that is about to change? This week the company announced that a portion of the bonus for its most senior executives would be linked to hitting “ESG” – environmental, social and governance – targets as well as simply increasing the overall value of the business.
It is far from alone. In 2018, after a series of scandals and legal settlement, Novartis set up a scheme whereby senior managers were marked on values and behaviour with bonuses linked to the highest scores, while a recent report from the London Business School found that 45 of the CEOs in the FTSE 100 index received at least some part of their bonus based on their ESG performance.
If “ethics bonuses” catch on who knows where they will stop? Perhaps your local car dealer should get a bit extra for not taking 20,000 miles off the clock of that used Toyota you are looking at. Maybe the traffic wardens…