The CIPD has launched new guidance to help HR staff and reward professionals mitigate the risks in reward.

The report identifies key steps employers can take to effectively identify, assess and manage the reward-related risks in their business.

The CIPD advises HR professionals to establish reward risk intelligence gathering systems, review reward strategy systems for risk, use established risk management tools, know their reward risk appetite and build an appropriate risk management capability.

Charles Cotton, CIPD adviser for reward and performance at the CIPD, says: "Our research identifies that reward risks are on the increase, and practitioners are struggling to manage these in a way that ensures risk is balanced against the need for reward to support and encourage agility and change.

"However, there are many good examples of HR getting on top of this. Savvy reward professionals are assessing their reward strategy and systems to ensure they are fully aligned with business objectives and are firmly geared towards driving sustainable business performance and success."