Cremer, now a professor in Behavioural Business Ethics at the Erasmus University in Rotterdam and at the London Business School, asked the bankers who they would most trust with their own savings.

 

 

Necessary incentive
So it seems when their own money is involved, top bankers do not believe in smooth operators with top salaries, but in old-fashioned service-oriented bankers who love their profession.

 

Answering the question on incentives and bonuses the top bankers replied that they don’t regard bonuses as an incentive themselves, but continue to believe bonuses are a necessary incentive to others.

 

 

But more and more critical voices are being heard in bankers’ circles.

 

Rutger van Nouhuys, director of the business division of the new ABN AMRO, recently indicated the bank wants to become the Netherlands’ number one business bank. However, they cannot spend as much on salaries as they would like because Finance Minister Wouter Bos has reduced and frozen both bonuses and fixed salaries. Mr Nouhuys said that, despite the wage reduction, he did not have a problem keeping top talent on board. So here is a top banker saying his staff will not leave anyway.

Temporary check
Professor De Cremer says bankers are not aware of the myth they themselves have created. The British newspaper Financial Times recently quoted other research which suggested that bonuses don’t make managers any happier and therefore form no incentive.

 

The Bureau for Economic Policy Analysis concluded in a report that top managers do not switch jobs quicker as a result of promises of huge bonuses.

 

According to Mr De Cremer, managers need to be woken up to the fact that the bonus story is a myth because the rules now being imposed by politicians are only a temporary check on the phenomenon. “We need to convince them it’s a myth - they themselves must stop wanting it”.