<abstract xmlns="http://www.w3.org/1999/xhtml"><p> This paper provides a brief review of the state of knowledge in the field of agency theory. The managerial power approach assumes that a chief executive officer is able to affect the scale of his or her pay. However, Kaplan (2012) and others see a different picture of the corporate-governance landscape, hence they provide certain market-based explanations for high compensation. Our paper examines the relationship between a firm’s performance and the amount of managerial compensation, and the ability of a CEO to affect a board’s decision regarding his or her total compensation. The dataset consists of 75 companies traded in the capital market in the US. Our panel dataset covers a 10-year period from 2004 to 2013. We developed a single equation panel data model. The resulting parameter values provide a different picture of CEO power and the interconnection between a firm’s performance and CEO pay in both sectors.</p></abstract>

This paper provides a brief review of the state of knowledge in the field of agency theory. The managerial power approach assumes that a chief executive officer is able to affect the scale of his or her pay. However, Kaplan (2012) and others see a different picture of the corporate-governance landscape, hence they provide certain market-based explanations for high compensation. Our paper examines the relationship between a firm’s performance and the amount of managerial compensation, and the ability of a CEO to affect a board’s decision regarding his or her total compensation. The dataset consists of 75 companies traded in the capital market in the US. Our panel dataset covers a 10-year period from 2004 to 2013. We developed a single equation panel data model. The resulting parameter values provide a different picture of CEO power and the interconnection between a firm’s performance and CEO pay in both sectors.

Does a “Ceo Chairman” Guarantee Better Performance from a Firm?

Czech University of Life Sciences Prague, Faculty of Economics and Management, Kamýcká 129, 165 21 Prague 6 – Suchdol, Czech Republic

DANUBE

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

{"article-title":"Does a \u201cCeo Chairman\u201d Guarantee Better Performance from a Firm?"}

This paper provides a brief review of the state of knowledge in the field of agency theory. The managerial power approach assumes that a chief executive...

Does a “Ceo Chairman” Guarantee Better Performance from a Firm?

Publié en ligne: 20 oct. 2016

Pages: 145 - 160

DOI: https://doi.org/10.1515/danb-2016-0009

Mots clés
Agency Problem, Incentive Plan, Board of Directors, CEO Compensation, Realized Pay

© by Pavel Srbek

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Does a “Ceo Chairman” Guarantee Better Performance from a Firm?

Publié en ligne: 20 oct. 2016

Pages: 145 - 160

DOI: https://doi.org/10.1515/danb-2016-0009

Mots clésAgency Problem, Incentive Plan, Board of Directors, CEO Compensation, Realized Pay

© by Pavel Srbek

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Mots clés
Agency Problem, Incentive Plan, Board of Directors, CEO Compensation, Realized Pay