Employee Compensation

Retaining and motivating managers and employees is a significant and ongoing challenge for many firms, particularly under changing market conditions. Failures in the compensation and incentive system sometimes come to light many years later, and prove very difficult to correct, because they have been assimilated by the organization.

The compensation and incentive system should fit in with the organization’s changing strategy, and support achievement of the targets and goals related thereto.

KPMG’s employee compensation department focuses on strategic planning and establishing compensation and incentive systems for managers and employees. The employee compensation department has extensive experience in advising firms in all matters relating to compensation and incentives. The department combines understanding of business processes and trends, human resources aspects, and up-to-date knowledge of taxation and accounting. It is also able to give weight to the intangible aspects of human resources. The department has extensive capability and experience in devising and implementing compensation plans for a wide range of Israeli and international firms.

Services provided by the KPMG employee compensation department

Long-term compensation plans – Plans for options on shares, phantom shares, loans for purchasing shares, plans for grants of shares (such as restricted shares), combined plans, compensation formulas, etc. KPMG provides creative solutions that fully take into account all the relevant aspects of these plans.

Performance-based compensation plans – The department offers various creative mechanisms for granting medium-term compensation according to advanced performance indices (such as the VBM index), as well as special performance indices that it has developed. In many cases, the advice provided includes recognition of the specific needs of the client’s business, devising a compensation mechanism that is suitable to these needs, and providing tools for applying and implementing the compensation mechanism.

Devising an overall compensation system – The department offers advice on intelligent planning of the compensation system in order to support and promote the firm’s strategic goals. It also provides assistance in devising and planning a compensation system, including a combination of diverse types of compensation for different periods. Among other things, this advice includes a general mapping of the compensation system in the firm (compensation check up), and devising compensation plans suitable for every unit in the organization.

Advice on salaries – The department conducts salary surveys in cooperation with professionals in order to enable firms to adapt their salary levels to the current market trends.

Advantages of the employee compensation department’s services:

• Advice is oriented towards business and finance, combined with a human resources perspective.
• Professional and up-to-date advice in the relevant taxation and accounting fields.
• Experience and familiarity with current trends and innovations in the market.
• Complete and global service in cooperation with KPMG’s overseas branches.

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