On ships the correction of the compass for (magnetisable) materials in the vicinity indeed works with small magnets, mostly done by specialised people. This helps to take away the largest deviation. Then, what is left (usually in the order of max 5 degrees) you'll have to read from a table that is provided by the specialised person, the correction depending on the course you are going at that moment.
The problem on motorised vehicles is the fact that the magnetic field lines around it are far from constant. Switching on your headlight will already have an influence, also because of the low voltage (12 V) and therefore stronger currents all producing stronger magnetic fields. Things like alternators also tend to produce strong magnetic fields.
So, a compass mounted on the handlebar would never be really reliable. I would advise the suggestion in the other reply, have it at hand, but before taking your bearing walk away from the bike (also when the engine is not running!).
Auke
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