Beyond the Base Salary: Why Executive Search Success Starts with Remuneration Benchmarking

The stakes are high

In the ultra-competitive executive market, a poorly structured remuneration package can lead to a rejected offer or, worse, a short-tenured hire. For executive roles, the stakes are too high for guesswork when it comes to putting forward a competitive offer.  Here’s what you need to consider.

The importance of competitive compensation

Many executives would argue that remuneration alone is not a driving factor, which I would agree with. However, executives are frequently required to exceed the standard remit of their role, at which point appropriate remuneration certainly becomes a factor. Executive structures are complex, more often than not combining STI’s and LTI’s.  

Benchmarking assesses the correct mix and quantum of all these components and helps clients avoid the number one reason for a rejected offer: a sub-par compensation package. Benchmarking ensures the offer is compelling from day one and also assists significantly at the point of remuneration review.  Regular benchmarking ensures current executives feel valued, boosting loyalty, discretionary effort and job satisfaction.

Budgeting & controlling costs

To avoid overpaying (or underpaying), benchmarking helps clients strike the right balance. Overpaying can waste shareholder (or owner!) funds, while underpaying risks losing candidates. A remuneration & benchmarking exercise ensures compensation decisions shift from guesswork to informed, strategic decisions backed by real-time market data.

Shareholder and regulatory alignment

Especially for listed companies, transparent and justifiable executive pay is a major shareholder focus. Benchmarking provides the logical, defensible rationale for the proposed package.  In terms of aligning pay with performance, effective executive benchmarking often includes structuring variable pay to be directly tied to long-term value creation (e.g., specific company growth metrics), ensuring executive interests are aligned with shareholder interests.

How Lawson Delaney can help

Our experienced team of Executive Search Consultants help organisations correctly size the complexity of a role relative to the market, leading to an accurate compensation range upfront.  We are specialists in providing objective data to professionally guide both the client and the candidate through sensitive pay negotiations, preventing offers from collapsing. We benchmark against the right comparator companies (e.g., similar revenue and complexity regardless of sector), and can offer real-time insights into market trends, including the value of non-monetary incentives (e.g., flexible work, equity structures, specific benefits) that a candidate may value more than cash.

Keep in mind that Executive remuneration can be an advantage and not a risk. If you’d like a confidential discussion on how we can support your organisation with your next Executive Leadership search or a project in Remuneration & Benchmarking, please get in touch today.
Contact me, Rohan McMaster, on 0493 168 528 or via rohan@lawsondelaney.com.au.