Engaging employees through compensation : exploring financial and non-financial strategies in the gaming industry

Abstract

This dissertation explores how financial and non-financial compensation strategies influence employee engagement within the gaming industry in Malta. This sector plays a vital role in Malta’s national economy and faces distinct challenges related to talent retention and workforce diversity. Moreover, the study is guided by the following research question: Which compensation strategies, financial or non-financial, are perceived to drive greater engagement in the gaming industry? Using a qualitative methodology, semi-structured interviews were conducted with eight HR professionals from various gaming organisations. The interview data were analysed using the Thematic Analysis method (Braun and Clarke, 2022 and interpreted through Social Exchange Theory (SET) (Blau, 2017), Herzberg’s Two-Factor Theory (Herzberg et al.,1959), and Equity Theory (Adams, 1965). The findings reveal that while financial compensation, such as competitive base salaries and performance-based incentives, is essential for ensuring fairness and preventing dissatisfaction, non-financial rewards are more frequently associated with sustained engagement. These include recognition, flexible working arrangements, career development opportunities, mental health support, and a strong alignment between organisational culture and employee values. Furthermore, the participants highlighted that engagement is best fostered through compensation strategies integrating fair financial remuneration with tailored, meaningful non-financial practices. However, a key limitation that emerged demonstrated that participants tended to reflect on their company’s practices rather than offering a critical or employee-based perspective. This HR-centric lens underscores the need for future research incorporating employee voices. Ultimately, this study contributes to academic and practical discourse by emphasising the strategic value of compensation beyond its transactional function. It reinforces the importance of aligning reward systems with employee expectations, organisational culture, and long-term engagement goals. Moreover, future research should explore how employees interpret and experience compensation strategies, particularly in diverse, multicultural workplaces like Malta’s gaming sector.