The New Polish Remuneration Model for Managers: A Discussion of the New Remuneration Act
Objectives: The main goal of this paper is to provide a short assessment of the new regulation on the remuneration of managers in order to answer the question of whether the new Act is effective and accepted.
Research Design & Methods: The article is based on the analysis of the relevant literature and legislative acts. There is also the analysis of the annual statements of listed companies with respect to the application of remuneration principles and the remuneration paid by selected companies in which the State Treasury had a shareholding in Poland, as well as the analysis of the resolutions of general meetings in terms of the determination of remuneration.
Findings: The new Act has significantly changed the philosophy of determining remuneration in accordance with the existing corporate governance rules, at the same time eliminating abuse and pathologies, and implementing a mechanism for rewarding active managers who effectively create company value.
Implications / Recommendations: The remuneration systems used to motivate management board members of companies, including their method of determination and the principles of the payment of the basic salary and performance bonus. It also had an impact on the managers’ motivation, affecting the companies’ financial results. Every new regulation should take into consideration a modern, comprehensive, and motivational model of remuneration for managers, one which complies with corporate governance rules and the constitutional principles of social justice.
Contribution / Value Added: The conclusions from this paper can be used for academic and business purposes, enabling an in-depth understanding of the current remuneration model and the reasoning behind the implemented solutions, and
facilitating the translation of the provisions of the Act on the Principles of Determining the Remuneration of Persons Managing Certain Companies of 2016 into the business realities of companies.
Article classification: research article
JEL classification: G3, H7, J3, K4, L2, L5, M5
remuneration for managers; managerial contracts; remuneration models; pay systems; management by objectives; awards and bonuses; corporate governance
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