Bonuses a 'self-created myth'
A recent study by David De Cremer, Professor of Behavioural Business Ethics at Rotterdam School of Management, Erasmus University and Visiting Professor at London Business School, has put forward the notion that "top-level executives in the Dutch banking sector believe bonuses are important, but not for themselves, only for their colleagues."De Cremer said: The findings of my research demonstrate that the need for giving bonuses within the banking world is a self-created myth. The press release accompanying the research admits that: "Although top executives are influenced by bonuses and accept them as a means of attracting top-level talent, it has become clear that they prefer to do business with a different type of banker preferably someone who puts the interests of the customer first."De Cremer adds, The outcome of my research makes it very clear that the whole notion that bonuses are very important, as promoted by the financial sector in the past decade, is at least in part a self-created myth one that claims that the intrinsic motivation of many bankers may be undermined by the absence of bonuses.I don't think I could trust a banker who wasn't motivated by money. By definition, it's why many became bankers in the first place.I wonder if the research would have the same result if conducted amongst the inhabitants of Greenwich or Mayfair? Also, De Cremer only interviewed 15 top banking executives. No top executive is going to enjoy seeing their company's turnover being spent on large bonuses for over-ambitious graduates who - in the long run - are after their jobs, yet the alternative is that the bright young things end up working for your rival. Executives are between a rock and a hard place - it is therefore unsurprising they see bonuses as unproductive yet indispensable.
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