Report On

MEASURING THE STRUCTURE OF

COMPENSATION SYSTEM OF A
COMPANY
 Course Title: Compensation Management
Course Code: HRM 4152
Section: A
Assignment on: Measuring structure of Compensation system of BRAC
Bank
Submitted by:
Name ID
Sousen Afrar Antu 111 162 002 ( 18)
Noshin Yeasmin 111 143 255 (3)
Nowshin Sharmin 111 143 271(4)
Tasnim Mubasshira 111 153 035(9)

Submitted To:
Md. Kazimul Hoque, Assistant Professor,
United International University
Table of Contents
Letter of Transmittal............................................................................................................................................... v
Acknowledgement: .................................................................................................................................................. vi
Executive Summary................................................................................................................................................vii
Chapter 1 .................................................................................................................................................................. 1
BACKGROUND OF THE STUDY ....................................................................................................................... 2
OBJECTIVE OF THE STUDY ............................................................................................................................. 2
Broad Objectives ................................................................................................................................................... 2
Specific Objectives................................................................................................................................................ 2
SCOPE AND LIMITATIONS................................................................................................................................ 3
Scope of the study ................................................................................................................................................. 3
Limitation of the study .......................................................................................................................................... 3
METHODOLOGY .................................................................................................................................................. 3
Sources of Data ..................................................................................................................................................... 3
Primary Sources: ................................................................................................................................................... 4
Secondary Sources: ............................................................................................................................................... 4
Data Processing and Analysis Methods ............................................................................................................. 4
Chapter 2 .................................................................................................................................................................. 5
Literature Review ...................................................................................................................................................... 5
Chapter 3 .................................................................................................................................................................. 6
Company Profile........................................................................................................................................................ 6
Brief History.......................................................................................................................................................... 6
Company Location ................................................................................................................................................ 6
Vision and Mission of BRAC Bank ........................................................................................................................ 7
Vision .................................................................................................................................................................... 7
Mission .................................................................................................................................................................. 7
Customers of the BRAC Bank: .............................................................................................................................. 7
Chapter 4 .................................................................................................................................................................. 9
Measuring Structure of Compensation: ................................................................................................................. 9
Catagories of compensation: ............................................................................................................................... 10
1. Extrinsic Compensation: ......................................................................................................................... 10
2. Intrinsic Compensation: .......................................................................................................................... 11
Contextual influence of having the structure:..................................................................................................... 11
 Internal Factors:................................................................................................................................................... 12
External Factors: ................................................................................................................................................. 12
Laws and Regulations: ........................................................................................................................................ 13
Labor Market:...................................................................................................................................................... 13
The basic pay followed by the company: ............................................................................................................. 14
The perspective of the industry on person focused pay: .................................................................................... 16
How they set their pay structure (steps to set pay structure) ............................................................................ 17
Chapter 5 ................................................................................................................................................................ 20
Organogram: ....................................................................................................................................................... 20
BRAC Bank subsidiaries are-............................................................................................................................... 20
CSR Activities: ....................................................................................................................................................... 21
Recommendation: .................................................................................................................................................. 22
Conclusion:............................................................................................................................................................. 23
References: ............................................................................................................................................................. 24

iv
 Letter of Transmittal
23rd September 2020

Md. Kazimul Hoque

Assistant Professor at School of Business and Economics
United International University, Bangladesh

Subject: Submission of term report on “Measuring structure of Compensation system of BRAC

Bank”

Dear Sir,
I, undersigned, would like to submit herewith the term report measuring the structure of
Compensation System of “BRAC Bank Limited”. Upon completion of our rigorous research on
BRAC Bank Limited, this term report has been prepared. Though, it was a hard job to perform, we
prepared this report comfortably and spontaneously. It has been an interesting and very enlightening
experience for us to work on BRAC Bank Limited topic. We have tried my level best to reflect
works in this report and tried to make this term report a successful one. This term report has-been
prepared to fulfill the requirement of our assignment of the Compensation management course.

We would like to express our sincere gratitude to you for your kind guidance & suggestions in
preparing this term report. It would be great pleasure for us if you find my term report informative
and useful to have an idea of BRAC Bank Limited.

Sincerely yours

Name: Sousen Afrar Antu

ID: 111 162 002

v
 Acknowledgement:
It is always a pleasure to remind the great people in the UIU University for their sincere guidance
that we received to uphold our practical and book knowledge in compensation management.The
opportunity we had with the course faculty was a great chance for learning and professional
development. Therefore, we consider very lucky as in group as we were provided with an
opportunity to be a part of it.
We were also grateful for having a chance to meet so many people in online who help us to get
more information in this period.

First, we would take the opportunity to express our heartfelt gratitude to Allah for making us
accomplish the term paper within the designated time. This term paper is a part of our academic
course Compensation Management. Every group was provided with a certain period of time to
complete the term paper.
This is high time we express our cordial thanks to our honorable course instructor, Md. Kazimul
Hoque, Assistant Professor, School of Business and Economics, United International University for
assigning such an effective task. Without co-operation and the support from him, it would not be
possible to prepare a resourceful paper. We are thankful to him for all the times. We consulted with
him and for being constantly patient in guiding us throughout the whole term paper. This has
enabled us to make a comparison between theoretical knowledge and practical applications of it.
Finally, thanks to everyone in the group for putting their efforts into completion of the task. We
perceive as opportunity as a big milestone in our career development. We will strive to use gained
skills and knowledge in the best knowledge in the best possible way. We will continue to work on
our improvement. We hope to continue cooperation with all of yours in future.

vi
 Executive Summary
BRAC Bank Limited. (BBL) is the most dynamic bank now in Bangladesh. BRAC Bank Limited
started its journey on the 4th of July 2001 originating from its source BRAC. Mainly, BRAC Bank
originated due to successful story of BRAC microfinance. Today BRAC Bank is considered as third
generation bank extending full range of banking facilities by providing efficient, friendly, and
modern fully automated on-line service on a profitable basis. One major area of the HRM function
of BBL is relevance to the effective use of human resources is Learning and Development. In this
term paper there is a complete discussion about the general information about BBL, building blocks
of compensation structure, influences of having the structure, the bases for pay, pay structure. The
company has standard that they need to maintain for each session conducted. As a result, in this
term paper an assessment is shown from Descriptive Method. The existing process of BBL does to
match point to point with this descriptive method but it is serving the reason efficiently and cost
effectively. Therefore, there is a continual need for the process of staff development to fulfill this
purpose.

vii
Chapter 1

INTRODUCTION

This report has been made over the chosen topic of “Measuring structure of Compensation system
of a Company” within the context of Bangladesh keeping in mind. We have done this report by
following a private bank named BRAC Bank based on the topic of the report. Thus, this report is
the compilation of the compensation management of a bank. We have followed several
compensation systems which was helpful for completing the report. This was a kind of research
about a bank by collecting information about their compensation system. There might be some
lacking. But it can be said that this report helped us to research within a small scale and gather
information about compensation management. This report may also help others to understand how
to build up a compensation system in bank and run it.

A small group of four UIU students were given a major duty to find out and the measuring structure
of a compensation system of a company in the context of Bangladesh. Though it was helpful, but it
was also difficult to understand all the compensation system. After all, we have completed our
report by taking help of the faculty about compensation system by our group contributions.

1
1.1 BACKGROUND OF THE STUDY
This report is our Compensation Management course requirement and another reason behind this
report is to gain an expert knowledge and a practical knowledge about measuring the structure of
compensation system in an organization. Compensation can be direct monetary or indirect monetary
benefits that received by an employee for providing services to his or her employer

The aim of the compensation system is to set clear and understandable principles for how much, to
whom and for what to pay, so that employees are motivated to improve their performance, achieve
the set targets and at the same time receive fair compensation. So we tried to find as much as
information regarding the compensation system.

1.2 OBJECTIVE OF THE STUDY

Broad Objectives

The broad objective of this study is measuring and analyzing structure of compensation system of
an organization. This practical orientation gives us a chance to coordinate theoretical knowledge
with the practical experience.

Specific Objectives

• To comprehend the total compensation system in the organization.

• To find the gap of the standard payment and actual payment in the organization.
• To providing monetary value to employees in exchange for work performed.
• To retain current employees and ensure equity.
• To control costs and comply with legal regulations.
• To attract skillful, talented, and knowledgeable employees.
• To maintain the employees, for faster progress of the organization.

2
1.3 SCOPE AND LIMITATIONS
Scope of the study
The report is all about the measurement of compensation in an organization. The report is prepared
using highest concern, widespread discussion with our respected faculty and group members. It has
given us a chance to know about the compensation system related to an organization. During this
period, we tried to get familiarize ourselves with the theoretical concept and practical process of
organizational compensation system.

Limitation of the study

The present study was not out of limitations. But as students it was a great opportunity for us to
know the compensation system of an organization. Some constraints are appended below-

• Adequate and in-depth well-organized information is not available for access

• Group members are not available at the same time because of different class schedule
• Due to unavailability it was hard to give equal contributions when need
• Due to time limitation we might have some lack of knowledge regarding compensation
management.
• Due to pandemic situation we couldn’t be able to visit the organization for more information

1.4 METHODOLOGY

The report is made through brainstorming of our all team members and following compensation
system. Secondary data are used to make the report. Our honorable faculty’s class lectures and
counseling are used to make the project.

Sources of Data-
• Primary sources
• Secondary sources

Usually we can collect data from these two sources.

3
Primary Sources: Basically, in this source we collect data by visiting the organization and talk
with them face to face. But this time we could not do this because of COVID-19 situation.

Secondary Sources: We collected secondary data from internet and website.

1.5 Data Processing and Analysis Methods

A series of steps performed on data to verify, organized, transform, integrate, and extract data in an
appropriate output form for subsequent use. Methods of data processing and analyzing must be
rigorously documented to ensure the utility and integrity of the data.

4
Chapter 2

Literature Review

BRAC Bank Limited is a sister concern of BRAC (Bangladesh Rural Advancement Committee) –
nationwide private organization in Bangladesh. BRAC has emerged as an independent and self-
financed organization in sustainable human development of Bangladesh. It is one of the largest
development organizations in Bangladesh employing 97,192 people, with 61% women. These
people are working with the two-fold objectives of poverty alleviation and empowerment of the
rural poor especially rural women. BRAC Bank, with institutional shareholdings by BRAC has
been the fastest growing Bank in 2004and 2005. The Bank operates with the aim where profit and
social responsibility go hand in hand as it strives towards a poverty-free, enlightened Bangladesh.
Brabant focuses on pursuing unexplored market niches in the Small and Medium Enterprise
Business, which hitherto has remained largely untapped within the country. In the last five years of
operation, the bank has disbursed over BDT 1500 core in loans to nearly 50,000small and medium
entrepreneurs in the country. The management of the bank believes that this sector can contribute
the most to the rapid generation of employment in Bangladesh. Since the inception in2001, the
Bank opened 22 branches, 350 SME unit offices and 19 ATM sites across the country, and the
customer base has expanded to 200,000 deposit and 45,000 advance accounts through
2006.Currently, BRAC Bank’s total deposit is Tk. 2,645.59 (in core), total loans is Tk. 2,450.58 (in
core), and the aggregate business is TK 5,096.17 (In core) in Bangladesh.

5
Chapter 3

3.1 COMPANY PROFILE

Brief History

BRAC Bank is a private commercial bank in Bangladesh, operated by the BRAC development
organization, focused on Small and Medium Enterprises (SME).BRAC Bank was founded on 4 July
2001 to reach the large number of unbanked people which were not covered by traditional bank. In
2001 BRAC Bank did not start its journey like any other conventional bank. The visionaries who
led the bank realized that the previously neglected Small and Medium Enterprises (SME) sector
plays significant role in generating growth and creating employment in the country. Over the past
few decades, traditional banks were reluctant to invest in this sector. At a time when it was almost
impossible for the SME entrepreneurs to get financing from the banking sector in Bangladesh,
BRAC Bank stepped forward and came to finance these unbanked SME entrepreneurs. BRAC Bank
has become the first Bangladeshi Bank to be rated the best by three of the top domestic credit rating
agencies in Bangladesh (CRAB AA1/ST-1, CRISL- AA+/ ST-1 and Emerging Credit Rating- AA+/
ST-1) and two of the world’s leading credit rating agencies (S&P Global Ratings - B+ and Moody's
Investor Service - Ba3) – portraying quality portfolio, higher capital base, stability and steady
growth trends.

Company Location

The bank has its head office in Dhaka, Bangladesh. It has 186 branches and 50 agent banking
outlets and 448 ATM's as of 31 December 2018.

6
3.2 Vision and Mission of BRAC Bank

Vision

Building a profitable and socially responsible financial institution focused on market and business
with growth potential, thereby assisting BRAC and its stakeholders to build a just, enlightened,
healthy democratic and poverty free Bangladesh.

Mission

• Sustainable growth in Small & Medium Enterprise sector.

• Continuous low-cost deposit Growth with controlled growth in retail assets.
• Corporate Assets to be funded through self-liability mobilization.
• Growth in Assets through syndications and investment in faster growing sectors.
• Continuous endeavor to increase non-funded income.
• Keep our debt charges at 2% to maintain a steady profitable growth.
• Achieve efficient synergies between the bank’s branches, SME unit offices and BRAC field
offices for delivery of remittance and the bank’s other products and services.
• Manage various lines of business in a full controlled environment with no compromise
compliance and on service quality.
• Keep a diverse, far flung team fully motivated and driven towards materializing the bank’s
vision into reality.

3.3 Customers of the BRAC Bank:

BRAC Bank is a performance driven dynamic organization, where its values founded at the core of
each activity as pillars. BRAC Bank has been striving to provide “best-in-the-class” services to its
diverse range of customers spread across the country under an on-line banking platform. BRAC
Bank Limited consists of four major business divisions namely: Corporate Banking Division, Retail
Banking Division, Small and Medium Enterprise (SME), Foreign Trade & Treasury. BRAC Bank
has a unique institutional shareholding between BRAC, the largest DFO in the world, the
International Finance Corporation (IFC), the commercial arm of the World Bank Group, and Shore

7
Cap International, a concern of Shore Bank Corporation. A fully operational Commercial Bank,
BRAC Bank focuses on pursuing unexplored market niches in the Small and Medium Enterprise
Business, which hitherto has remained largely untapped within the country. Almost 40% of BRAC
Bank’s clients had no prior experience with formal banking. The Bank has 313 regional marketing
unit offices offering services in the heart of rural and urban communities and employs about 1,200
business loan officers – around 70% of total staff.

8
Chapter 4
4.1 Measuring Structure of Compensation:

Compensation Strategy is one of the most important strategies in the HRM Function as it influences
the costs of the organization and potential bad decision can lead to very serious damages to the
organization. The compensation strategy drives the compensation policies and compensation
processes in the organization. The compensation strategy provides the organization with the vision
of its compensation drives the effort of HR employees and manages the investments into the human
capital. The compensation strategy sets the limits for the compensation and benefits section,
provides the business with the predictability of the personnel expenses and helps to control the
personnel expenses efficiently. The compensation strategy defines the priorities in compensation
and benefits section. The well managed compensation increases the performance and satisfaction of
employees. The employees have the assurance of being rewarded the same manner and using the
same principles across the organization.

9
4.2 Categories of compensation:

We differentiate Compensation into two categories. Those are:

1. Extrinsic Compensation: Both monetary and non-monetary rewards are included in
Extrinsic Compensation. But organization development professionals promote intrinsic
compensation more than extrinsic one.
Core Compensation: There are two categories of core compensation. Base pay and
base pay adjustment over time. Companies disburse base pay to employees in one of
two forms:
• Hourly Wage: The pay an employee gets on behalf of his service based on
hourly basis is hourly wages.
• Annual Salary: Here employee gets his salary based on his load of work not
how many hours he worked.
Adjustments to Core Compensation:
Cost of living: The periodic base pay increases that are founded on changes in prices as
recorded by the Consumer Price Index (CPI).
• Seniority: The periodic additions to base pay according to employees’ length
of service in performing their jobs.
• Merit: Employees earn permanent increases to base pay according to their
performance. Merit pay rewards excellent effort or results, motivates future
performance, and helps employers retain valued employees.
• Incentive: A compensation system that fluctuates according to employees’
attainment of some standard based on a pre-established formula, individual or
group goals, or company earnings.
• Person-focused: Also called skill-based pay in which employees get paid for
their skills or knowledge they are capable of applying productivity to their
jobs.
Legally Required Employee Benefits
• Social Security Act
• Workers’ compensation laws
• Family & Medical Leave Act
• Health Insurance

10
Discretionary Employee Benefits
• Disability insurance
• Life insurance
• Retirement plans
• Paid time off
• Accommodation and enhancement

2. Intrinsic Compensation: It basically plays with employees’ psychological mind-sets that

result from performing their jobs. Medical professionals and health care providers think it is
an effective method. Because it gives a feeling that his/her work matter for others life.

Pay represents most companies' largest expense—and their most powerful performance tool.
The need for compensation structures and programs to work as intended cannot be overstated.
Therefore, a periodic impact analysis of pay programs is vital to answer three questions,

First, although corporate leaders may think they pay competitively, "is that actually the case?
Second, the organization is spending $X on these programs, but are the dollars going to the right
people?"
Third, "is the organization getting the right kind of outcomes for that investment?"

A compensation impact analysis shows how pay programs, including pay philosophies and
strategies, positioning, and base pay and incentive design, are playing out in reality in terms of
financial costs and returns as well as organizational impact.

4.3 Contextual influence of having the structure:

Several factors can affect the compensation structure. This is one of the most noteworthy factors
impacting worker pay. Basically, a firm, which is prosperous and fruitful, can pay more than the
competitive rate. Along these lines it can draw in a prevalent bore of work force. Regularly the
trade guilds additionally request an expansion in remuneration because the association is prosperous
and can pay more. The different employee related factors that influence compensation rate are given
below:

11
 Internal Factors: Some of the employee related factors are there which are mostly common
in affecting the compensation rate is:
i. Employee Performance: It is constantly compensated with pay increment and
accordingly it inspires the laborers to improve in future.
ii. Employee Seniority: In the present condition rank of worker making contrast in
installment of remuneration contrasted with junior representatives. Normally senior
representatives’ requests for more compensation than fresher in view of their hang on
related work and its capacities. Today numerous organizations are requesting senior
representatives for key situations by offering fat compensation and even some of the
time resigned workers are offered with attractive pay for key positions which manages
performing various tasks in association. Worker's organizations consistently lean toward
this target rule for pay rises.
iii. Employee Experience: This makes an individual immaculate by giving important
experiences and hence compensated moreover. Today organizations are requesting for
10 to 20 years’ experience up-and-comers particularly for the chief positions. The
organizations assume that experience applicant gang’s initiative abilities which impact
the other conduct and execution. For the most part experience up-and-comer play out the
activity without need of preparing which is tedious and manages matter of cost to
organization. Henceforth the experience competitors request more compensation than an
inexperienced applicant.
iv. Employee Potential: Firms similarly pay their delegates, especially energetic ones
dependent on their idle limit. Programming associations are phenomenal model for this,
IT graduate precisely who completed his preparation having potential in the subject can
build an extraordinary activity with high portion wherever on the planet.

External Factors: The Cost of Living Adjustment (COLA) is a yearly change in wages to
represent an adjustment in buying power as estimated by the Consumer Price Index. The
Consumer Price Index is an inflationary marker determined month to month by the U.S.
Branch of Labor that quantifies the adjustment in the expense of a fixed rate of items and
administrations, including lodging, power, food, and transportation.

12
Laws and Regulations: Laws and regulations impact the remuneration of employees in
many areas, such as:
• Work hours and compulsory time-off (paid and unpaid)
• Minimum wage
• Overtime
• Compulsory bonuses
• Employment at will

Labor Market:
• Official laws on salary and wages, work contract, installment time, wage installment
delay, working insurance, etc.
• Individuals' way of life in the territories where the workplaces of the organization
are.
• Individuals' living and expending standard.
• The average pay rate in the labor market of comparative work.

Academic Institutions: Having great scholarly capabilities from Reputed and standard
instructive foundation impact the pay of the likely applicant in their enrollment in
organizations. Up-and-comers the individuals who concede in these foundations are
resolved, having skill and great space information which organizations require.

Inflation: Increment in the costs of items and abatement in estimation of the cash is
called as Inflation. The reasons for Inflation are numerous which are raising costs, fall in
the cash an incentive in global business sectors, raising assessments by government and
stagnation in the advancement of economy, and so forth.

Technological Change: Innovative changes likewise impact the obsession of

compensation levels. Because of the progressions in the innovation there might be
deficiency of talented labor here. Thus, the association will give high wages to talented
faculty.

13
 Economy: The condition of economy additionally impacts the compensation and pay
obsession. Pay rates will he diverse in a steady economy than in a discouraged economy. In
the event of discouraged economy there might be increment in flexibly of work and these
outcomes in the obsession of lower wage rates.

Supply and Demand: It's significant to know about the accessibility of pertinent ability in
the geographic district where you're selecting. In case you're enrolling in a zone where the
interest for a specific range of abilities and experience exceeds the gracefully, you ought to
hope to pay more so as to pull in ability.

In-demand skill sets: With regards to deciding remuneration, key aptitudes might be a
significantly more solid measurement to analyze against than work title. All things
considered; various organizations may have totally different meanings of a similar activity
title. On head of that, numerous ranges of abilities can apply to a wide assortment of jobs –
which are all successfully viewing for a similar ability. That is the reason it is significant for
managers to consider the estimation of key abilities while deciding remuneration.

4.4 The basic pay followed by the company:

Person –focused or competency –based pay is more effective than any other pay system. There are
different types of person focused pay criteria. Types of person-focused pay:

➢
Pay for knowledge: A compensation system where an employee is awarded by
managerial service, or professional workers for successfully learning specific
curriculum.

➢
Skill based pay: The employees who are skilled in one basic physical work and
increases these workers’ pay as they master new skills.
The pay increases are usually 3 types of skills. Those are:
o Horizontal skill: The area of expertise in one work. Such as an employee is skilled in
electrical engineering. So, he has the horizontal skills that an electrical engineer should
have.
14
 o Vertical skill: Various types of skills in one employee. Such as an employee has skill of
electrical engineering and mechanical engineering. So, he has the Vertical skill in the
engineering department.
o Depth skill: Very depth skill or expertise in just one specific area of any sector.

We all know that BRAC Bank Limited is a leading and fastest growing private commercial bank in
Bangladesh. To ensure employee motivation and satisfaction BRAC Bank Ltd maintains a
competitive compensation program. BRAC Bank awards bonus with its employees from the profit it
earns every financial year. BRAC Bank won many prestigious awards which is the indicator of
good management skill and effort of the employee. The bank always acknowledged the valuable
contribution made by its employees for the continuous superb achievement every year. The bank
created a sense of community among the employees by encouraging communication with each
other in the Management committee Meeting and across the department and divisions. This
discussion helped the employee to teach each other jobs and roles and develop an understanding
about the bank as a whole. They also organize training programs and workshops to improve the
skill of the employee. BRAC Bank Ltd has entered into agreement with some good medical center
for providing service to the bank’s employee and family members at concession rate. Staff welfare
fund has been created for securing the employees form accidental loss. There is some interesting
activity that normally a bank cannot do but BRAC Bank do. The Bank arrange annual picnics,
family nights where employee participate along with their family members. In this benefit scheme
the branch managers can travel to neighboring countries with their family members. BRAC will
bear their expenses. Various attractive retirement benefits are in place. BRAC bank offers festival
bonus during EID, and on other different occasions. Deserving candidates are given a regular basis
promotions and increments. To promote entrepreneurial skill and actions, encourage people to
assume responsibility and to encourage people to assume responsibility and to encourage
compliance culture, some of the remuneration which was paid indiscriminately earlier has been
made performance based and result oriented. As such the annual assessment process has gone
through major changes. It is hoped that new system will provide sustained support for Bank’s
contentious success. BRAC Banks reward and benefits practices aim to support in attracting and
retaining the best people for the organization. To maintain an attractive salary and benefit package,
they regularly compare themselves to a select group of other businesses and reward higher
performance by individuals and teams.

15
The bank wants to build a profitable and socially responsible financial institution. It carefully
listens to the market and business potentials, It is also assisting BRAC and stakeholders to build a
progressive, healthy, democratic and poverty free Bangladesh. It helps make communities and
economy of the country stronger and to help people achieve their financial goals. The bank
maintains a high level of standards in everything for their customers, shareholders, acquaintances,
and communities upon, which the future affluence of the company rests.

According to the Half-Yearly Financial Statement of 2013- the number of Employees including
contractual engaged for the whole year or part there of (who received a total yearly remuneration of
Tk. 36,000 or above) were 6,306 whereas the total number of employees were 7,075 as the same
period of pervious year.

4.5 The perspective of the industry on person focused pay:

Person focused remuneration plans reward agents for acquiring position related, data, aptitudes, or
abilities rather than for displaying productive occupation execution. Person focused pay rewards
delegates for the assurance of execution later on; merit pay, and persuading power pay reward
laborers for ensure fulfilled (work execution). Thusly to manage compensating agents often
suggests three central sorts of individual focused pay programs: pay-for-data, capacity-based pay,
and competency-based pay. Sometimes, associations join person focused remuneration programs
with standard authenticity pay programs by allowing pay increments to laborers agreeing. When
they find any employee as an asset for the organization then they try to keep them and give them
incentives.
The governing body and the compensation board of trustees are answerable for deciding the level
and structure of pay paid to the CEO and other leader chiefs. The issue of the compensation of the
bank supervisors as of late was shown as one of the central issues of corporate administration and is
called attention to as one of the abnormalities which prompted the budgetary emergency.
Remuneration bundles must be adequate as far as their level and structure to pull in, hold, and rouse
qualified chiefs to make investor or partner esteem. In principle, the degree of remuneration ought
to be resolved upon the investigation of expected worth creation by the directors and the choice of
the extent of that esteem that ought to be offered to those administrators who added to producing
those impacts. By and by, notwithstanding, the pay level is controlled by benchmarking CEO's

16
compensation with their companion gathering. In spite of the fact that this targets staying serious as
to pay, it has clear downsides, of which the most perilous is deciding compensation without express
respect to esteem creation, and another is the tightening impact: when various organizations inside a
gathering attempt to meet or surpass the middle, the middle expands.

During the last thirty years, salaries in financial sector companies have been growing substantially.
Banks are paying their officers a high base salary and the total compensation often reaches 7-digit
numbers. It must be admitted that after the global financial crisis began, the remuneration of top
banking managers dropped, but in subsequent years was rising again. In recent years the incentives
for bank managers rely more on long-term performance, though many banks still strongly reward
for annual outcomes.

High growth and the level of total remuneration (due to high bonuses) in the banking sector has
been criticized, especially in the context of the financial crisis and the weak performance of banks.
The extremely high level of many bank managers pay and the lack of linkage of the pay with the
financial situation of those institutions has led to a discussion regarding the issue of remuneration
schemes. The issue of managers’ remuneration is an important aspect of corporate governance and
the failure of forming an adequate system of incentives for managers can lead to serious problems
with the functioning of banking institutions. Analysis of the deficiencies of the remuneration
systems have led to formulation of certain principles and regulation within this area.

4.6 How they set their pay structure (steps to set pay structure)

The pay structure of BRAC Bank LTD. is well organized. BRAC Bank Ltd. takes special care about
their employee and they maintain the pay equity and fairness. They not only give the salary they
also give some additional benefit like mobile facilities , medical allowances, Loan at lower interest,
arrange picnic and family night, give reward to the employee (based on their performance),
transport facility and so on. Pay structure of BRAC Bank LTD is give below:

17
Position Title Pay Range (In Tk. Average
A month)
MD Managing Director 700000-800000 750000
AMD Additional Managing 400000-450000 425000
Director
DMD Deputy Managing Director 300000-350000 325000
SEVP Senior Executive Vice 170000-190000 180000
President
VP Vice President 100000-105000 102500
SAVP Senior Assistant Vice 85000-90000 87500
President
AVP Assistant Vice President 65000-75000 70000
SEO Senior Executive Officer 50000-55000 52500
EO Executive Officer 40000-45000 42500
PO Principal Officer 35000-37000 36500
SO Senior Officer 30000-32000 31000
MT Management Trainee 25000-28000 26500
Officer Officer 24000-25000 24500
JO Junior Officer 16000-17000 16500
AO Assistant Officer 13000-14000 13500
TA Trainee Assistant 10000 10000

18
Name of Shareholder Total Shares % of Total Share
BRAC 76,55,265 37.18
Mr.Quazi Md.Shariful Ala 204 0.001
Dr. Hafiz G.A. Siddiqi 204 0.001
Ms. Nihad Kabir 171 0.001
Mr. Syed Mahbubur Rahman 171 0.001
Mr. Shib Narayan Kairy 204 0.001
Mr. Md. Aminul Alam 204 0.001
Ms. Tamara Hasan Abed 171 0.001
Dr. Saleh uddin ahmed 156 0.001
Shorecap International Ltd. 14,38,949 6.99
International Finance Corporation (IFC) 12,00,547 5.83
General Shareholders 102,95,754 50.00
Total 205,92,000 100.00

19
Chapter 5
5.1 Organogram:

5.2 BRAC Bank subsidiaries are-

Bkash Limited: Started its journey on 1s t March 2010, which was a pioneer in
the mobile finance service of Bangladesh. According to 2017 annual report they
had total revenue of 17,723.6million.

20
 BRAC EPL Stock Brokerage Limited: BRAC EPL stock brokerage which is the
rd
3 largest stock brokerage house among250 brokerage in the country was

established to cater to the need of stock brokerage business in the country. It has
almost 3% market share.

BRAC Sasjan Exchange Limited: BRAC Sasjan is the largest remitter to

Bangladesh by holding 30% market share of the remittances sent from the
UK.

BRAC EPL Investment Limited: In Bangladesh almost all of the Merchant

Banks provide only investor discretionary management service, whereas BEIL
provide both type of service.

5.3 CSR Activities:

Corporate Social Responsibility is embedded in the value system of BBL, being committed
to CSR means they will ethically be committed towards the society of this country. BRAC
Bank is in line of 3P which are People, Plant and Profit. BRAC Bank CSR activities reflect
their intention regarding a sustainable development of our society and stakeholders. Aim of
CSR activities for BRAC Bank is to achieve a positive impact on society by maximize the
creation of shared value for owners of the business, its employee’s shareholders, and
stakeholders. BBL prioritizes long term program over short-term program which has
sustainable and lasting impact on the people and society of the country. Employer’s
passionate participation in CSR activities adds a new dimension to BRAC Bank CSR
portfolio.

21
Recommendation:

➢
BRAC Bank should encourage more women to take loans and become self-
sufficient and to do so they should arrange more seminars.

➢
They should focus more towards under privilege women in the society, so that
they can maximize their service.

➢
They can arrange training sessions for the existing customers regarding how they
are using their loans, does they need any other assistance regarding their business
or loans.

➢
As it is an era of new technology, so BRAC Bank should arrange training sessions
regarding the necessity of technology based on how adopting new technology
could be helpful for the entrepreneurs, how to use them properly.

➢
BRAC bank should focus on building the network stronger among the account
holders of TARA. It will help the account holder to gather more knowledge
regarding the wide range of opportunity available for them.

➢
BRAC Bank should derive their focus more towards rural areas because most of
their services are city centered whereas there are so many opportunities available
for the women of rural areas but they do not have proper finances to use those
opportunities.

➢
A huge number of women in Bangladesh work in ready-made garments sector.
But they do not get the privilege properly. Their knowledge about banking is very
poor. So BRAC Bank can play a significant role by working for these women in
terms of letting them know how deposit, loan works.

22
Conclusion:

The most important expected service quality factor is dependability of the bank. Employees and
the physical facilities of the bank have significant relationships with the overall service quality.
BRAC Bank perceived that the bank should fulfill the interests of the customers to the bank by
providing different service facilities. The first and most important factor of perceived service
quality of BRAC Bank customers is the satisfaction of the clients’ best interest. The second
important perceived service quality factor is physical facilities of the bank. The customer
perceives that the bank should have appealing physical facilities in the bank.

The perceived service quality factors and the overall service quality of the bank shows that each
factor is independently significantly related to the overall service quality. This indicates that the
perceived service quality factors have significant influence individually and jointly over the
overall service quality of their Bank.

23
References:
1. BRAC Bank Limited. (n.d.). Retrieved From:https://www.BRACbank.com/en/
2. Entrepreneurship of Bangladesh. (March, 2019). Financial Express.Retrieved from:
https://thefinancialexpress.com.bd/views/female-entrepreneurship-in- bangladesh-
1553181544
3. Growing Women Contribution in Bangladesh. (February, 2019). Bangladesh
Awami League. Retrieved from: http://www.albd.org/articles/news/32391/The-
growing- women-entrepreneurship-in-Bangladesh
4. Annual Report of BRAC Bank Limited 2018. (2018). Retrieved
from: https://www.BRACbank.com/en/investor-relations.

5. Book, Strategic Compensation, A Human Resource Management Approach, Joseph J.

Martocchio
6. Researchgate.net/publication
7. Oreilly.com/library/view/strategic-compensation
8. Assignmentpoint.com/business/human-resource-manegement

24