Graham Ward, former co-head of pan-European equities at Goldman Sachs, on why a big bonus may come at a big cost.

So the Christmas season rolls round again, and in financial services grown men will step into the men’s room to compare the size of their bonuses.

I say grown men, because, in general, women are woefully underrepresented at the higher echelons, but we will save that for another day.

The annual bonus round invariably makes headlines and the public can only look on enviously as the City fat cats sup cream at the doors of the temple of Mammon. As an executive coach, and former employee of Goldman Sachs, I have seen both sides of the coin (pun intended).

The mid-December meeting with my boss became a ritual over 15 years into which a huge amount of psychological investment was placed. After all, for most, the bonus is a yardstick: It tells them how they are performing relative to their peers and helps to confirm them as individuals.

The problem is that the half-life of this effect rarely lasts past the January sales. The reality is that whatever you are given, it’s just a number. I would be the first to admit that a good bonus goes a long way to saving first base on Maslow’s hierarchy of needs. But most City bonuses go way beyond that. Once the mortgage is paid, the kids are schooled, the Lamborghini is valeted and the Tuscan villa is staffed, life often becomes a tad meaningless, another working year a chore.

Unfortunately, a high proportion of the clients with whom I work discover just that. Many successful financiers scale the heights armed with a combination of gilt-edged academic credentials and a sizeable dose of insecurity, providing the fuel for ambition. They climb quickly and steadily, but often in mid life take pause in the rarefied air and, for a variety of reasons, reflect on the scenery. The view can be unsightly.

A pile of cash is one thing. An unhappy wife, however, 80-hour working weeks, kids you only see at the weekend raised by a nanny, three weeks a year annual vacation which for the most part is spent asleep in order to recharge, is not quality of life.

HL Mencken said: “The chief value of money is that we live in a world in which its value is overestimated.” If the likes of Bill Gates are giving it all away, shouldn’t we really ask ourselves why we are bothering to accumulate it in the first place?

The author is a partner at www.amandlaconsulting.com and a programme director at INSEAD Business School’s Global Leadership Centre.