This chapter explores in more detail the wider corporate context in which any individual reward package must be designed. The remuneration structure will always be a function of the individual circumstances of a particular company and will depend on the origins and history of the business, the ownership characteristics, sector and many other elements. However, there are some useful principles that may guide the choices and direction of pay for particular circumstances. These are summarised in Figure 5.1.

The rest of this chapter looks at each of these situations in more detail.

Start up and initial public offering (IPO)

A start-up company is likely to be a combination of new money and new management. The company is born out of an idea of the founder, or founders, who then have to find investors willing to fund the development of the idea into a business proposition. Biotech companies, for example, were founded predominantly by entrepreneurial scientists who had to raise funds to commercialise research.