CEO compensation, corporate governance, and performance of listed platinum mines in South Africa

Ngwenya, Sam Maluleka

doi:10.22495/cocv13i2clp8

Cited by 3 publications

(3 citation statements)

References 28 publications

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“…While studies such as Haque and Ntim (2020) and Chouaibi, Rossi and Zouari (2021) attempted to incorporate ESG, they were all conducted in developed countries in Europe, namely Austria, Belgium, Denmark, Finland, France, Germany, Italy, The Netherlands, Norway, Spain, Sweden, Switzerland, and the UK. Furthermore, instead of investigating the compensation for all the executives, most of these studies investigated the chief executive officer (CEO)'s compensation citing the prominent role that the CEO plays in resource allocation and shareholders value creation (Bussin, 2015(Bussin, , 2018Ngwenya, 2016;Theku, 2015).…”

Section: Evidence Of the Shortcomings In Directors' Remuneration Lite...mentioning

confidence: 99%

The use of non-financial performance metrics in determining directors’ remuneration: The case of listed companies in South Africa

Matemane,

Moloi,

Adelowotan

et al. 2023

AJOBE

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Despite the increasing importance of environmental, social and governance (ESG) factors, it is not fully understood whether companies consider these factors when designing compensation plans for their directors. This study investigated the extent to which directors’ remuneration integrates ESG factors. The study sample is made up of JSE-listed companies for the period 2015 to 2021. The estimated generalised least squares regression technique was used to analyse the data. The results show the shift towards the integration of ESG factors in directors’ compensation plans. It should be established which ESG factors are pertinent in the South African context.

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Section: Evidence Of the Shortcomings In Directors' Remuneration Lite...mentioning

confidence: 99%

The use of non-financial performance metrics in determining directors’ remuneration: The case of listed companies in South Africa

Matemane,

Moloi,

Adelowotan

et al. 2023

AJOBE

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“…As for SOCs, the CEOs are the agents. Consistent with the agency theory, remuneration plans should be designed to motivate managers to make decisions in such a way that would maximise shareholders' prosperity and minimise the manager-shareholder agency problem (Ngwenya, 2016).…”

Section: Theoretical Groundingmentioning

confidence: 99%

The year-on-year analysis of the relationship between chief executive officer remuneration and state-owned company performance in South Africa

Bezuidenhout

Bussin

2020

SA j. hum. resour. manag.

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Orientation: Executive remuneration remains very much at the centre of academic and policy debates. There seems to be a lack of consensus on the origins of the substantial increase in executive remuneration.Research purpose: This study aimed to further explore the relationship between chief executive officer (CEO) remuneration and state-owned company (SOC) performance by investigating the year-on-year behaviour of the relationship. The observed trends regarding the direction and strength of the relationship inform business and economic occurrences that provide an organisation with an in-depth understanding of the relationship.Motivation for the study: The rationale for this analysis was to broaden the understanding of the behaviour of the relationship over a period by studying the year-on-year correlation coefficients.Research approach/design and method: This quantitative, longitudinal study collected secondary data from the annual reports of 18 Schedule 2 SOCs over the period 2006 to 2014. Spearman’s rank correlation coefficient was the principal statistical technique utilised in the study.Main findings: Overall, the results revealed a fluctuation in the relationship between CEO remuneration and SOC performance with turnover having the most stable relationship with both fixed pay and total remuneration.Practical/managerial implications: The use of discretion in the determination of CEO remuneration within SOCs is likely to attract attention considering the fluctuating, sometimes volatile, relationship between the constructs. This will create the motivation for dynamic-policy frameworks to ensure consistency and fairness.Contribution/value add: The value of this research is that SOC remuneration committees now have empirical evidence of the importance that turnover plays as a performance measure.

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“…Although there is abundant literature on executive compensation, very few studies have focused on the mining sector, despite the pivotal role it plays in the economy. The few studies that have been conducted in the South African mining sector-such as those by Bussin (2018), Ngwenya (2016) and Theku (2014)-suffer fundamental weaknesses that the current study aims to address. First, in investigating the relationship between executive compensation and a company's performance, these studies narrowly focused on the relationship between chief executive officer (CEO) compensation and company performance.…”

Section: Introductionmentioning

confidence: 99%

Executive Compensation and Company Performance: Pre- and Post-Marikana Uprising Analysis

Nkwadi

Matemane

2022

SABR

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Background: Executive compensation has become a controversial topic globally. Recent and past incidents of labour unrest, including those that plagued the South African mining sector in 2012, highlighted the level of controversy on the subject. Purpose: The purpose of this study was to investigate the relationship between executive compensation and company performance in the mining sector of the Johannesburg Stock Exchange (JSE). Methodology: The study was quantitative in nature and used purposive sampling in selecting 28 mining companies listed on the JSE. Estimated generalised least squares (EGLS) and seemingly unrelated regression (SUR) were used to analyse unbalanced panel data spanning from 2007 to 2018. Findings: The results show that there is no relationship between executive compensation and market value added (MVA), revenue growth (RG), return on assets (ROA), and return on equity (ROE) both before and after the Marikana event. In the period before the Marikana event, 2007–2012, economic value added (EVA), share price (SP) and total assets (TA) were statistically significant in explaining variability in executive compensation. However, in the post-Marikana period, 2013–2018, only the TA and earnings per share (EPS) are statistically significant in explaining the variability in executive compensation. Value: This study offers a practical contribution to policy makers and practitioners on pertinent performance measures that can aid in minimising agency costs when designing executive compensation plans.

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CEO compensation, corporate governance, and performance of listed platinum mines in South Africa

Cited by 3 publications

References 28 publications

The use of non-financial performance metrics in determining directors’ remuneration: The case of listed companies in South Africa

The use of non-financial performance metrics in determining directors’ remuneration: The case of listed companies in South Africa

The year-on-year analysis of the relationship between chief executive officer remuneration and state-owned company performance in South Africa

Executive Compensation and Company Performance: Pre- and Post-Marikana Uprising Analysis

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