Main Components of a Compensation Policy

The core principles of any good compensation policy:

• Being as objective as possible: this ensures fairness and acknowledges a basic truth: people talk. The goal is to ensure fairness, real and perceived (more or less the same package for the same position, all things being equal),
• Cash is for a short/mid-term reward when equity is a long term alignment,
• Compensation needs to be adapted to market practices (especially, to local practices).