Global companies move towards centralising reward
David Woods, 03 October 2008
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A trend is developing for global companies to manage their international compensation systems centrally.
The WorldatWork Global Compensation Practices Survey shows 53% of organisations take a centralised approach to compensation compared with 49% in 2004.
European Union states are aligning compensation across borders. Less than a quarter of respondents (23%) said Western Europe poses a challenge with compensation compared with 33% in 2004.
However, Asia still presents a challenge for companies hoping to reward a globally- diverse workforce as 70% see this a major challenge this year compared with 55% four years ago.
More than half (54%) of employers have HR systems that cover most or all of their international operations.
Adam Sorensen, global total rewards practice leader at WorldatWork, said: "When it comes to compensating a globally-dispersed workforce, multinational corporations would be wise to balance consistency with localisation. In addition, communicating the value proposition to employees will be a great competitive advantage given that, according to our survey, a surprisingly low number of employers [13%] issue [total] reward statements globally."
