In the light of current accountancy scandals, suggests that high levels of incentive above base salary for senior executives (so that as much as 75% of total remuneration may be at risk from a poor performance and/or unpredictable market conditions) are indeed damaging, because they place the executives under a perhaps irresistible temptation to exaggerate results for personal benefit.
When is an incentive not an incentive?
- Sed quis custodiet ipsos custodes?
Juvenal said it nearly 2000 years ago: 'But who is to guard the guards
themselves?' Recent accusations of irregularities at major public companies,