Everyone has its own preference and due to the differences between each other's preferences, the conflict of interest occurs. It is the same in a company that a company and its workers have different preferences and sometimes the workers may not behave in a way that the company wants its workers to behave. Bonus is introduced by firms to give their workers more incentives to work harder and parallel their workers' preferences with the companies' preferences.
However, recently in the financial sector, many banks and institutions cut their bonuses in order to prevent their employees from focusing too much on short term returns. I do not think cutting bonuses will solve the problem of focusing too much on short term returns. People focus on short term returns because of these two factors rather than their bonus level.
Firstly, when people can easily swtich their jobs within the industry, they are more likely to focus on their short term performance as they can boost their short term performance to win highe positions in other firms in the industry, in this way they get promoted more easily and faster. Secondly, how much people focus on their short term performance depends on how much and often their records and work will be tracked. If a worker's past work will not be tracked after he/she switches his/her position and stops working on the past project, then the best interest of the worker is to boost the performance before he/she switches his/her position and has no interest to care about the long term effect of his/her work after he/she leaves the job. Based on these two factors, bigger bonuses can enlarge the problem of focusing on short term performance but it is the cause of the problem.
Therefore, I think to avoid focusing on short term interests and ignoring long term effects is a job that the whole industry should cooperate and build a system of tracking workers' job in the industry, it cannot be solved by one or two individual firms cutting their bonus levels.
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