A 3B statement can be very insensitive by its design.....so I’m...

A 3B statement can be very insensitive by its design.....so I’m going to relate my “feelings” on this one today.

I feel it is extremely poorly delivered.
I feel that it lacks the usual business principles for which “incentives” are devised.
I feel that people could draw the conclusion that this is a straight out gift to the team by the team.

The definition of “Incentive” is this: something that incites or tends to incite to action or greater effort, as a reward offered for increased productivity.

In business parlance it is like the carrot on a stick just in front of the donkey’s nose so that it must stretch to get the “incentive”.

I totally agree with these incentives...the directors and management should be awarded for performance.

But transparency would suggest that the goals and objectives should be known in advance and the incentive is weighted to achievement of those pre-determined goals.

This could quite possibly have happened here...but we don’t know and in the absence of “knowing” the market gets spooked by all sorts of possibilities.

A totally spooked individual could draw the conclusion that this isn’t an incentive...it is a gift to the boys by the boys...and let’s face it, the junior goldies are notorious for this!

A simple ann by the directors explaining the rationale would end it all.

And I will make one other point at the risk of Noellyn and others ripping into me again...MPO is heavy on options.

For instance, the 07/08 Directors report was 11 pages long...6 of them was devoted to discussing their options and remunerations!

If the options genuinely encourage extra efforts and attract talent and “smarts”...I have absolutely no problem.

But if the options are like a Christmas bonus...then they are only an incentive for the first year...thereafter the recipient expects it as part of the remuneration rather than for outstanding efforts.