Wednesday, May 27, 2009

Ethics, Morality or Measurement Metrics

This interesting article from NYTimes caught my attention, though its not the first but it prompted me to opinionate!!

Every one knows that corporations shape employee behaviour through metrics, rewards and punishments. Putting it as lamely as possible.

Then why is it that inspite of so many years of good and bad fortune executive pay are not driven by metrics of good governance, employee welfare and moral code of conduct, but only by quarterly revenue and profit numbers and shareholder value only.

Why does it need to be always an either or situation. Good Governance, Employee Welfare and Moral Code of Conduct will ultimately lead to better profits. Then why its not the metric for executive compensation?