Traditional elements of reward management, such as controlling costs and delivering return on investment, remain a core focus of the reward role, but new external pressures are beginning to widen the reward professional’s remit, according to this study by EY. Legislation is a factor, as are new approaches to performance management and the need to develop an employer brand to attract talent.
EY believes that this shift provides an opportunity for the reward function to play an important part in shaping the future of work, but that this may require changes for some teams in order to contribute effectively.
‘The onus is growing on reward functions to take the lead on current challenges and to manage compliance with new regulations and legislation. This is a real opportunity for reward functions to take the lead on shaping the future of work and perhaps explains why many commentators are suggesting the HR directors of the future will increasingly have a background in reward. In order for reward leaders to play a more prominent role, the nature of the function may need to evolve. Reward will increasingly need to lead effectively on broader people strategies in addition to managing its traditional activity base.
Reward leaders will need to be confident in their advice and approach and ensure their functions and approaches are set up effectively to deal with new challenges. Increasingly they will need to play a key role in managing expectations around the business about which initiatives will deliver value and why, in the context of their individual business strategy.’