Pay data released by Mercer on the use of Short-Term Incentives (STIs) countries has highlighted surprising indications of nascent business confidence in Western and Eastern Europe, Australia, New Zealand and Middle East. The data, taken from 21,000 companies in 62 countries also indicates a weakening in confidence for companies in Asia Pac, Latin America and North America.
- STI trends indicate declining business confidence in Asia Pac, Latin America and North America; cautious optimism in EEMEA, Australia, New Zealand
- UK and Western Europe STI 2012 payout predictions for executives suggest business confidence is static although financial targets will be met
The data comes from Mercer’s ‘Short-Term Incentives around the World’ report which draws on annual incentive information from over 7.6 million employees across the globe. For this release, Mercer analyzed STI data from Executives / Top Management to gain insights into company confidence that their financial targets will be met.
“An STI is remuneration based on annual performance against set criteria and STIs form an important part of the remuneration package for key employees and senior executives,” explains Mark Quinn, Partner in Mercer’s and Reward specialist. “A key criterion for the funding of bonus awards is successful company performance. So, if a company is predicting that it will pay out less to executives in 2012 than it did in 2011 – as our data shows is happening in certain regions – it indicates that companies expect their financial performance to be worse in 2012 than in 2011. The reverse is also true.”
Source: Extract from Mercer Release , 31st May 2012