Bosses of recently nationalised businesses have had a nasty shock under their new government employers.  The senior management teams of banks or industrial companies that have accepted bail-out funds have also had to accept a cap on their bonuses.  Public opinion supports restricting their remuneration, and the caps have been set by political expedience rather than a full understanding of their consequences.  The debate is really only just beginning: you can expect it to grow in the coming months.

In the EFQM community we can watch with interest the debate about the fairness or economic logic of capping bonuses, but we should be capable of actively contributing to the understanding of how bonuses could be set and measured.  

The EFQM Excellence model is firmly built around a structure of ‘enablers and results’: when we ‘score’ the performance of an organisation using RADAR the result is a balanced measure of what the organisation has achieved and what is capable of achieving.  Under-investing in any of the mechanisms that will ensure long term sustainability of the firm – such as employee development, customer satisfaction or the management of resources will punish the evaluation of the firm, irrespective of its stock market value.  

Our ‘movement’ (if indeed we can call ourselves that, as very few of our assessors actually carry their beliefs into the street on banners) is all about achieving transparency in measuring and improving the sustainability of the organisation.  

Governments and the general public happen to think that corporate sustainability is important: failure to impress the importance of this on management teams has just resulted in the massive use of public funds to bail out failed banks and industrial organisations.  They are angry and will probably impose a greater alignment between the rewards of running a business and its sustainability.

How will this goal of greater accountability for sustainability be implemented?  The nightmare – but sadly what is also probable – is that arbitrary mechanisms (such as absolute caps on bonuses) will be imposed with limited debate about whether the real issue (that the performance of a business and its management team needs to be judged on better criteria) is adequately addressed.

We (and I mean you and us, as experts in the use and conduct of assessment) should have a part to play in this public debate, by representing our organisations and the good work they have done to balance the short and the long term: where good results come from and how the benefits are shared.  Now that is a very public agenda for ‘Business Excellence’. 

Will you join us, in the bonus debate?