Delta bonus
An incentive component based on a defined increase in earnings. The agreement sets the earnings measure, comparison period, thresholds, payout rate and other terms.
Delta bonus in round numbers
Hypothetical pure-delta component: annual operating income rises from US$5m to US$6m on the same defined basis, producing a US$1m bonus base. The payout requires an agreed rate and any other plan conditions. Assume this component pays zero for a flat year; it can still coexist with salary or other guaranteed compensation.
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| Measure | Amount |
|---|---|
| Prior-year operating income | US$5m |
| Current-year operating income | US$6m |
| Increase forming bonus base | US$6m − US$5m = US$1m |
| Bonus payout | Depends on agreed rate and other terms |
Terms Related to Delta bonus
Operating box · Management incentive plan (MIP) · Capital allocation · All of the glossary