Article1993

Ownership Structure, Board Relationships and CEO Compensation in Large US Corporations

133 citations0/0 files storedAccounting and Business Research

No readable copy stored yet — this record is metadata only.

No open-access location is known for this record yet.

Literature note Cite in a project Citation map

Corporate Finance and Governance Auditing, Earnings Management, Governance Corporate Governance and Financial Management

Abstract

Concern over the continuing rise in executive compensation and lacklustre company performance has led to an increase in investor and board activity in corporate governance. Institutional investors are leading the new activity and changing the nature of the governance system in the United States. A model of the evolving governance system is presented and relevant characteristics of firm ownership structure and the CEO-board relationship are explored with regard to their impact on the pay-performance link. The results for ownership structure suggest that institutional investors do limit the payment of unearned compensation to the CEO, but that the presence of 5% equity owners has no significant impact. The results concerning the CEO-board relationship suggest that longer tenure as CEO leads to greater compensation, but neither the percentage of outside directors, the director retainer, nor the CEO's years of company service have a significant effect on compensation. Overall, the evidence supports the view that institutional investors are enhancing the accountability of CEOs. The evidence also supports the idea that boards would benefit more from gaining outside directors who are impartial rather than from simply increasing the number of outside directors.

Paper brief

Loading…

Cite this work

Citation unavailable for this work.

BibTeX RIS CSL-JSON

No public copy is stored for this record, so only the metadata is cited.

Citations in this library

Citation map →

Stored only when both papers are in the corpus — 133 citations exist upstream.

References

1983Separation of Ownership and Control 1980Agency Problems and the Theory of the Firm 1988Management ownership and market valuation 1985The Structure of Corporate Ownership: Causes and Consequences 1980Organizations and Environments 1985Corporate performance and managerial remuneration 1988Compensation and Incentives: Practice vs. Theory 1984Organizations and Organization Theory.

Cited by

2016Board composition and corporate social responsibility in an emerging market 2005Corporate Governance, Leadership Structure and CEO Compensation: evidence from Taiwan 2014What does “corporate governance” actually mean?2005Do CEOS get Paid too much?2019The roles of family ownership and family management in the governance of agency conflicts 2007Institutional Activism Types and CEO Compensation: A Time-Series Analysis of Large Canadian Corporations †

Explore the map →

Papers that cite the same references — the relational fallback while embeddings are still backfilling.

Imported from OpenAlex (CC0) — nothing here is generated.