10 Tests of integrity in reward decision-making
August 2025
How partners are rewarded provides a direct and unencumbered snapshot of the firm’s values.
Integrity in how partner reward decisions are made is a deliberate lever that shapes culture: if partners know that their compensation committee is a tight ship, they worry less about protecting their profit-share and are more free to do great work and develop great clients.
To ensure that partner reward decisions are made in a way that is fair, principled and able to stand up to any level of scrutiny, I offer this non-exhaustive list of 10 integrity tests that every Partner Remuneration Committee (RemCom) should consider.
- Induction. Each RemCom member should receive adequate induction for the role, the firm's reward policy, RemCom processes, data analysis and handling cognitive biases.
- No shadow members. Reward decisions should only be made by RemCom members and RemCom members only; no one influences RemCom members in the shadows (e.g. no backchannels to a powerful rainmaker or an ex-managing partner).
- Decision-making process. There needs to be a documented and transparent decision-making process that RemCom follows to reach individual partner reward allocations.
- Criteria. The criteria for how partner contribution inputs translate to reward outcomes should clearly distinguish between (a) effort, (b) results achieved
and (c) behaviors exhibited. - Cognitive biases. RemCom members should feel safe to call out cognitive biases when they recognize them.
- Exception management. RemCom should not make out-of-policy exceptions for partners who they deem to be "obvious star performers" lightly. For example, RemCom resists allocating a high profit share to rainmakers above what the policy calls for just because the rainmaker made a lot of noise about leaving if they don't “get paid” more (equity partners don’t “get paid”; they share in the firm’s profits).
- Confidentiality. RemCom deliberations are confidential until agreed results are communicated as per policy. For example, preliminary reward allocations are not quietly floated for a reaction to an insider group of powerful partners before they are communicated to the partners at large.
- Integrity analysis. Before reward outcomes are finalized, RemCom should conduct an integrity analysis that considers not just internal disparities (e.g. gender, race, other protected classes) but also how collaborative efforts impact results, how external benchmarks have been consulted and how non-financial elements have been given appropriate weight.
- After-Action-Review. Each reward round closes with an after-action-review that results in documented priorities for change, including how collaborative efforts and results impact motivation, incentives and reward.
- Continuous improvement. RemCom conducts a comprehensive self-evaluation for continuous improvement at least tri-annually.
Integrity in reward decision-making is not just a matter of principle. It is a necessity for sustaining trust, attracting the best talent, improving partner contributions in line with plans and producing outcomes that prompt firm-wide growth.
RemCom must do its part in setting the tone that partners should follow. Setting the tone includes ensuring that every reward aligns with values, transparent processes and measurable standards.
Looking for ways to strengthen the integrity of your Partner Remuneration Committee? Here are some links to additional support:
- Online course: MHPR Advisors’ Partner Remuneration Committee Accelerator. Strengthen your remuneration committee and empower your senior leaders to become highly effective partner remuneration committee members
- Partner Compensation Review: Contact the MHPR team directly to review your current partner compensation system and create robust decision-making framework using MHPR Advisors’ proven standards
- Partner remuneration policy 12-point checklist: Most partner compensation policies are not fit for purpose. Download our 12-point checklist and find out how your policy stacks up
