Short Term Incentives
Overview
Short-Term Incentive (STI) plans are designed to align not only with Annual Operating Plans (AOPs), but also to serve as a stepping stone towards long-term performance. Effective STI programmes reward executives for delivering financial results as well as for their initiatives and actions taken to build the organisation of the future. Our comprehensive approach to STI design assists organisations in creating incentive structures that lay the foundation for strong fundamental performance.
Support We Offer
- Defining plan objectives and value drivers
- Defining eligibility criteria
- Defining funding approach
- Defining plan gates
- Interlinkages between company, business unit / function, and individual performance (weightage-based or multiplicative approach)
- Performance metrics (financial / non-financial / strategic) at the company, business unit / function, and individual level
- Interlinkages between performance metrics (weightage-based / multiplicative approach)
- Defining the payout curve and setting thresholds for performance and payout
- Deferral provisions
- Claw-back and malus provisions
- Scenario modeling and stress testing
- Expense modelling
- Plan documentation
- Employee communication