Recent research from neuroscience has demonstrated that our brain has an altruism centre which is separate and quite distinct from the centre aroused by financial incentives. Financial incentives trigger one of the most primitive parts of the brain, the nucleus accumbens, which has traditionally been associated with our “wild side.”
Scientists call this region the “pleasure centre” because it is linked with the “high” that results from drugs, sex and gambling. Furthermore, research shows that the pleasure centre and the altruism centre cannot both function at the same time: one or the other is in control.
Finally, it turns out that when the pleasure and altruism centres go head to head, the pleasure centre seems to be able to hijack the altruism centre. In other words, there is a neurophysiological reason why exaggerated financial incentives can override our altruistic motives. For this reason, companies should make sure that financial incentives are not exaggerated and are in any case properly aligned with the desirable objectives of building lasting greatness.
We must conclude that companies clearly need to pay reasonably well in order to attract and retain the right people in the first place. However, we believe that the purpose of compensation is not to “motivate” the right behaviours from the wrong people.
Compensation should be reasonable because it is part of human nature to expect fair treatment when it comes to compensation, which should be somehow proportional to our efforts and/or results.
Source material: The Leaders Dilemma – Hope, Bunce, Roosli
(my friends at bbrt.org)
Trevor Lee, EP International