Executive Bonus and Benefits

Running head: EXECUTIVE BONUS AND BENEFITS
EXECUTIVE BONUS AND BENEFITS
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1EXECUTIVE BONUS AND BENEFITS
Table of Contents
Answer to Question 1......................................................................................................................2
Introduction..................................................................................................................................2
Analysis of environmental measures...........................................................................................2
Conclusion...................................................................................................................................5
Answer to Question 2......................................................................................................................5
Introduction..................................................................................................................................5
Performance measures.................................................................................................................6
Conclusion...................................................................................................................................9
References......................................................................................................................................10

2EXECUTIVE BONUS AND BENEFITS
Answer to Question 1
Introduction
Employee bonuses linked to the objectives of the organization often lead to positive
outcomes for the firm. The different environmental concerns have become a serious topic of
concern for the businesses worldwide (Ağan et al. 2016). The emissions and other harms done
by the business to the environment often affects the ecosystem and hence, this has become a
topic for global debate. For this reason, the different organizations have started linking the
executive bonus to the environmental performance of the firm. Hence, the main aim of the given
analysis is to underline certain environmental indicators, which will help to measure the
performance of the executive employees.
Analysis of environmental measures
Various corporations around the globe have begun a new compensation system of paying
the different executives their bonuses based on the progress which they tend to make on their
corporate sustainability goals and environmental performances which simply means their
performance with respect to the reduction in energy costs as well as the energy consumption
having been made. The new system is being made quite popular in the different companies of
America and other related countries as well (Bennett, James and Klinkers 2017). Although the
management of the different customers based on their performance is not a new concept and the
theory of management by objectives has been used in major executive compensation schemes in
order to ensure adequate pay and growth, however, these performance measures generally relate
to the performance of the firm in financial terms or their people terms.

3EXECUTIVE BONUS AND BENEFITS
The fundamental concept of the Key performance indicators has been used as the
benchmark system for various years which thereby tends to motivate the employees and thereby
encourages them to perform well. According to Luo et al. (2015), a new organizational
performance emerged which had implications which were far-fetched with long term
implications and objectives, which related to the achievement of the sustainability and
environmental objectives. Sustainability has moved on from the realm of corporate assets and
other information like energy, carbon emissions, water and related wastes to measure how well
the organization has been performing at large.
Another reason why the sustainability situation has become more of a demand is because
there have been a wide range of corporate developments which helps in filtering down the
different organizations and even their relation with the different parties and hence, just
emphasizing on the sustainability compliance cannot be enough as the firm needs to have higher
standards to achieve their objectives on progress as the new regulators and shareholders are also
requiring it.
For the purpose of ensuring that there are specific and set measures in order to ensure that
the manager`s performance can be measured in monetary terms certain specific performance
indicators have been laid down. These performance indicators have been given as follows:
Utility consumption: The first environmental and sustainability indicator which may be
used in the organization will be the utility consumption indicator. The utility consumption
indicator tends to measure the amount of utility which a business has consumed at a particular
period of time in order to carry out the operations of the business (Flammer 2015). The more
units that the business consumes, the less eco-friendly it can be taken to be. Hence, it must be the