Who Owns Total Rewards? Why Finance, HR, and Operations Should Build It Together

In many organizations, compensation starts with a spreadsheet. The finance team builds the model, human resources administers the program, and operations lives with the results. Each group does its part well, yet the program ends up living in two places and fully serving neither.

In Episode 14 of PBO Perspectives in Business, Finance & HR, CEO Fran San Diego sat down with Consulting CFO Kristy Facchini, Consulting Chief People Officer Nicole Devine, and Lisbeth Fletcher, Director of Staff Operations and Administration at Feeding San Diego, to explore what changes when total rewards has a shared owner. Here are the lessons leaders can put to work right away.

Start with behavior, not benchmarks

Market data matters, but it is not the first question. Kristy's advice is to begin with two questions: what behaviors are we paying for, and what result do we expect to see? When the answers align with the strategy, finance can stress test the model across scenarios and optimize for both cost and engagement.

The alternative is a plan that rewards the wrong thing. Kristy described a client whose bonus program was tied to revenue alone. Revenue belongs in the formula, but so do margin and each location's contribution to overhead. Nicole shared a similar pattern in professional services firms, where compensation tied only to individual production can build personal books of business instead of an ownership mindset that grows enterprise value.

Let the CEO define the outcome

Every strong plan traces back to one question for the CEO: what is the single most important outcome the business is working to achieve? For Feeding San Diego, that might be meals distributed in the community. For a growing company, it could be EBITDA, gross margin, or top line revenue. Fran shared that she once received an executive compensation plan and had to ask what the plan was meant to accomplish. Without that clarity, even a well-built plan has nothing to measure against.

PBO Advisory applies four operating principles once the goal is clear:

• Reward impact and outcomes
• Design for fairness and growth
• Keep it simple enough to calculate and understand
• Create shareholder value by driving success with customers and clients

“Focus on the return on your labor investment. If we answer that question with rigor, the conversation is heading in the right direction.”Kristy Facchini, Consulting CFO

Speak to the board about return, not just range

Boards often ask about compensation in terms of market competitiveness, but what they usually want to understand is return on talent investment. Those are two different conversations with two different sets of metrics. At Feeding San Diego, where every dollar supports the mission, Lisbeth explained that the board expects responsible stewardship and empowers leadership to create an environment where people feel valued and respected.

Design for the whole workforce

With multiple generations working side by side, one-size benefits rarely land. Nicole noted that people across every generation want to feel appreciated and valuable. What changes is the form: mentorship and collaboration for early-career employees, different priorities for those nearing retirement, and flexible options such as wellness stipends, tuition reimbursement, and employee assistance programs for everyone in between.

Model costs carefully, and value what costs nothing

Healthcare costs are rising quickly, and Kristy recommends modeling benefits on the full workforce, including the profile of future hires, rather than on an average employee. At the same time, some of the most meaningful benefits cost little. Cross-training with another department, a seat in a board meeting, peer recognition, and volunteer time connected to the mission all build belonging. Feeding San Diego encourages every employee to volunteer at food distributions, and uses peer-to-peer recognition through Bonusly, which has increased engagement across the organization.

Communicate more than you think you need to

A benefit only creates value when employees understand it. The panel shared practical ways to make that happen:

• Ask employees what they value before redesigning the program
• Share a total rewards summary that shows the full value of pay, benefits, time off, and perks
• Keep incentive compensation visible throughout the year, not just at payout
• Offer information in multiple formats, from lunch and learns to one-on-one broker appointments
• Survey staff annually, build an action plan, and report progress back

As Lisbeth put it, total rewards is really about trust. When leaders communicate openly and connect investments in people back to the mission, employees feel valued, and they are better equipped to serve.

Bring everyone to the table

The throughline of the conversation is integration. The CEO sets the direction. The CFO models the investment and its return. The CPO shapes the design, the messaging, and the culture. Operations brings the reality of how work gets done. When all of those perspectives are in the room from the start, total rewards becomes a strategy everyone owns.

Listen to the full episodeTotal Rewards | Building It Together ft. Lisbeth Fletcher

Go to Episode 14 →