In well-managed organisations, managing rewards is about far more than making sure staff are paid on time, or even that they are paid a market rate for their work. In recent years, companies have developed complicated mechanisms both for measuring staff performance and for ensuring that employees are properly compensated for it.

The resulting reward strategies are as much about psychology as economics. Some employees respond best to simple financial compensation; investment banking is a good example of a business where performance and cash rewards – usually in the form of a bonus – are tightly linked.