Can you believe that Silicon Valley Bank employees received bonuses hours before government takeover as reported by CNBC? To understand the significance of this event, it is important to first understand the context in which it occurred. SVB is a prominent player in the tech industry, providing banking services to many startups and technology companies. Considering the current fall out, SVB is under the control of regulators in the US. (Recent news is that HSBC acquires SVB). However, just hours before the takeover were announced, SVB issued bonuses to its employees. This move has been criticized as being ethically questionable, as it suggests that the bank’s priorities were not focused on its clients or shareholders, but rather on its own employees. It also means that executives thought that performance targets were achieved in 2022. How is it possible that a bank is on the verge of closure and employees get a bonus? The performance bonus system itself is questionable.
There are past examples of global companies, where performance bonus and incentives spoiled the...
