Making Sustainability a Bonus
Interesting report in Guardian Sustainable Business that Intel and Alcoa are putting sustainability/CSR-type metrics into how they calculate their Executive’s bonuses (if only by a token amount to date). To my mind, this kind of incentive will work where sustainability is integrated into an existing system – giving out cash bonuses for environmental improvements alone can lead to gaming the system.
But the more I think about it, the more I like the idea – provided sustainability becomes a significant factor in the amount of bonus. The financial crisis was blamed on individuals making poor decisions because their whopping great bonus depended on short-term gains at the expense of any other consideration. But what if you restructured the bonus system to reward short term performance and long term issues? It would drive behaviour towards sustainability win-win-wins and balance the short term and long term prospects for the business.
What do you think?