EPISODE 1: “PAYING FOR GOOD PODCAST” WITH CORINNE CARR, FOUNDER AND REMUNERATION CONSULTANT, PEOPLENET LTD
2nd JULY 2020
[Corinne Carr: CC] [Robert Joy: RJ]
RJ: Corinne, you’re launching the “PAYING FOR GOOD” podcast for our listeners. Would you like to tell us a bit about yourself and what you do?
CC: Yes. Hi, Rob. Well, as you well know, I’m originally from Paris. And I guess that can be heard through the accent. Although I’ve been in the UK for over 30 years now, the accent will never go away! So I started my career, here in the UK with Bank of America. And I was an HR, Human Resources generalist when I first started with the bank. And after a year or so, it became apparent that I had a special interest in numbers and analytics. So they transferred me to what was called at the time, the Compensation and Benefits department, which I very much enjoyed. I got excellent training from the bank, which still serves me today. I stayed with the bank for about seven years and then in 1998, I set up my own remuneration consultancy called PeopleNet Limited. So, ever since, that’s over 20 years now that I’ve been working on an interim and a consultancy basis for clients. These clients include international banks, asset managers and listed firms.
RJ: Excellent. Well, tell us why the podcasts then.
CC: I would say about three years ago, I attended an event which was talking about sustainability which I knew very little about at the time. And then the United Nations Sustainable Development Goals came up and as listeners may know, there are 17 of these goals, very big global goals. So I became interested in the bigger picture: what’s going on in the world from a people and a planet point of view. So I read about the SDGs, the Sustainable Development Goals and I encourage everyone to read about them and where we are against those goals. Even in the UK, there are still areas that need particular attention. So these big goals have got a target date to be achieved by 2030. So it’s only 10 years away and there is already a big funding deficit to achieve them.
So as I was attending this event, I got back and I thought, well, HR and Reward professionals are actually in a privileged position to do something about these global problems. We design pay structures which incentivise, reward or penalise leaders and employees for what they do and what they don’t do.
So in fact, we can even map out the whole Employment Value Proposition for our employees against the UN Sustainable Development Goals. So I call this area of Reward, which crosses over sustainability and reward, “Responsible Reward” as you would say, responsible investments and Reward.
So after a year or so of doing some research, I wrote a report with Cass Business School a couple of years ago, which is entitled “Responsible Reward: how to fulfil your Environmental, Social and Governance promises through performance and pay” which listeners are welcome to download from my website www.peoplenet.ltd.uk.
And during the research phase of that report, I interviewed a number of key players in the industry. And one of them was Steve Waygood, who is the Chief Investment Officer at Aviva investors. And Steve kindly shared with me a very simple diagram, a version of which you can actually find on my website, which illustrates that we all wear several hats. We are employees, we are savers. We are borrowers, we are customers, all at the same time.
So our values are very much reflected in all the interactions that we have. And we want to work with companies and for companies that reflect our values.
So two years on after the report, the world is actually in a different place. We’re having climate change challenges. And now with the virus situation and global social tensions, these are big problems which cannot be solved by governments only. And I believe that businesses have a role to play to resolve them.
So my small contribution to resolving these global problems is to shine a light on what we can do about them. And there’s a lot we can do in our own field. Hence the podcast!
RJ: I see. And the name “PAYING FOR GOOD”?
CC: That’s kind of a catchy name, I thought. So it’s linked to two different areas. The first one is the idea of paying for good performance, paying for doing good in the world. That means looking after the environment and after the communities with whom we interact, whether they are internal communities as the employees that work for businesses, or external communities with whom we interact.
There’s another side to it as well which I thought was encapsulated in “PAYING FOR GOOD”. It’s the idea of malus and clawback provisions. And what we mean by that is when remuneration policies are drafted, they usually include certain provisions. Whereby if some events come to light, once awards have been granted, by award, we means bonuses, have been granted to senior executives, it is possible to reduce future bonuses or indeed ask for the repayment of past bonuses. So “PAYING FOR GOOD” really much means that if you’re paid for doing good, then the money is yours for good!
RJ: Oh, I see. But do you really think we should be “paying for good”?
CC: So that’s certainly something that’s worth debating and it can be a bit controversial. In fact, one of the podcast episodes will raise that very question. So we know from public information, public data submissions, that an increasing number of firms are taking sustainability factors like safety, customer metrics, people metrics, they’re taking all of these, ‘extra-financial factors’, and not as some people would say ‘non-financial factors’, they are definitely impacting the bottom line so we call them ‘extra financial factors’.
They take them into account in the design of their bonus and their long term incentive plans. And that’s indeed an increasing trend in the remuneration world. Although, there’s still plenty of room for improvement, that’s for sure!
And we also know that people tend to focus on what triggers the payment of their bonuses as their performance is measured against those triggers. So however, I do recognise that some people have intrinsic values and not everyone needs to be financially incentivised nor rewarded to behave in certain ways. The two types of people live and work side by side, and indeed they form the culture of a firm.
RJ: How will the podcast work?
CC: So this will be a first limited series of 10 episodes. And if people like it and enjoy it, then I’ll look at doing more episodes. Each episode will last for around 30 minutes and I’ve invited talented individuals from my professional network, which covers both HR and investors, to share their knowledge and insights on very specific topics, all linked to the Responsible Reward world. So I asked them questions and sometimes, you know me Rob, challenging questions! There’s a call to action for the listener at the end of each episode, where we also share a freebie because everybody likes a freebie! So there’s something for the listeners to do at the end of each episode, an action to take. And each interviewee shares their contact details. So if listeners want to follow up with them directly, then they are very welcome to do so.
RJ: And is there anyone else who’d like to speak with?
CC: So I’m really fortunate that I’ve got a network of people, very knowledgeable and supportive. I’m always interested to speak with people who have a view on new ways of looking at remuneration.
And in particular, I’d like to speak with more firms that have already implemented some form of Responsible Reward and who are willing to share the ups and the downs of making those changes. So we can see from the data, as I’ve mentioned before, that they are an increasing number of firms who are taking that on board. It would be good if they were willing to share their thinking, and how they got to where they are now, with the rest of the community.
RJ: And when does it start?
CC: The podcast will start in the first half of July, once all the technical side of things is up and running, so imminently!
RJ: And tell us why would people tune in?
CC: Firms want to design and implement ways of incentivising and rewarding their leaders and their workforce. So they are always looking for new ways of remunerating and rewarding their employees, and in fact, their leadership as well.
And on the other hand, employees also want to work for employers that take bigger goals into account than just making money. So Responsible Reward is there to address both these demands from both employers and employees. The podcast guest speakers, remuneration and investment professionals, help to think these ideas through.
RJ: And how can people access the podcasts?
CC: So it’s available on all the traditional podcast platforms like Apple Podcasts and Spotify, but for ease, to receive each episode to their inbox, then I would invite them to sign up to my weekly newsletter.
RJ: Okay. Well, thank you very much, indeed. I hope our listeners will agree that that was a fascinating insight into Responsible Reward and “PAYING FOR GOOD”. May I wish you all the best with your podcast.
CC: Thank you very much, Rob. Pleasure speaking with you as always.
RJ: Thank you. Goodbye, Corinne.
Useful link: https://www.linkedin.com/in/corinnecarr/