A new study on executive engagement has revealed that most CEOs consider the non-financial aspects of their job much more important than their financial reward. Recognition and job security were found to have the least impact on satisfaction for CEOs.
The study, conducted by Vlerick Business School and management network Business Leaders, covered a sample of almost 1,000 European CEOs and found that they are mainly driven by ambition and non-financial factors, such as the challenge the job brings with it, the feeling of achieving progress and the pride of working for the organisation.
Professor Xavier Baeten from Vlerick Business School believes that Boards and remuneration committees incorrectly estimate the importance of financial reward for CEOs:
“This study shows that higher salaries for top executives have almost no impact on CEOs’ level of commitment and satisfaction. CEOs feel strongly committed to the organisation and are generally satisfied with the financial reward. Here they mainly look at market conformity. Boards and remuneration committees do not seem to be aware of this and should pay more attention to the perceived fairness of the pay, both by the CEO themselves and by the broader social field. More attention should also be paid to performance management”.
The study also looked specifically at differences in work satisfaction between male and female CEOs. Notably, female CEOs obtain most motivation from the work climate and cooperation with other members of the top management.
CEOs are less satisfied with the clarity and feasibility of targets set, the amount of travel their work entails and organisations’ willingness to change.
Joël aan ’t Goor, CEO of Business Leaders, says, “This is the first time that motivation, driving forces and satisfaction have been studied in a group of CEOs of this size from medium-sized and large companies with a distinction made between financial and non-financial factors. We want to share these insights to benefit the business world”.