CEO Influence and Executive Compensation

Sridharan, Uma V.

doi:10.1111/j.1540-6288.1996.tb00863.x

Cited by 48 publications

(31 citation statements)

References 13 publications

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“…A positive relationship between company sales growth and all the compensation gaps between CEOs and Vice‐Presidents is expected. Sridharan (2006) states that CEO compensation levels are essentially a function of CEO influence over the board, the growth in sales and the size of the company. If sales grow, as males have been described as more competitive, male CEOs will probably try to extract a better personal compensation than VPs for their efforts to make the company grow.…”

Section: Methodsmentioning

confidence: 99%

Gender, Top Management Compensation Gap, and Company Performance: Tournament versus Behavioral Theory

Vieito

2011

Corporate Governance

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Manuscript Type: EmpiricalResearch Question/Issue: This study is among the first to investigate the impact of gender on the relationship between the compensation gap of the CEO and Vice-Presidents on company performance, testing if companies managed by a female CEO or a male CEO follow tournament or behavioral theory. Tournament theory suggests that a large compensation gap between CEO and company Vice-Presidents (VPs) leads to higher company performance; behavioral theory states that higher performance may be achieved with a small compensation gap between CEO and VPs. Additionally the study also investigates if companies managed by a female CEO perform better, or not, than those managed by a male CEO, and if the factors that explain the compensation gap between CEO and VPs in these two groups of companies are the same, or not. Data for the investigation emanated from the USA during the period 1992 to 2004. Research Findings/Insights: The results reflect something quite new in the area -on average, companies managed by a female CEO perform better, and have a smaller compensation gap between the CEO and VPs than companies managed by a male CEO. In companies managed by a female CEO, a smaller difference in the total compensation gap between CEO and Vice-Presidents leads, on average, to higher company performance, however, when the CEO is a male, a higher compensation gap is required to obtain higher company performance. The results provide empirical support that the behavioral theory is predominant in companies managed by a female whereas tournament theory is predominant in companies managed by a male. Theoretical/Academic Implications: The paper fills an important gap in the existing literature by providing econometric evidence that males and females CEOs have a different impact on the relationship between CEO and VPs compensation gap and company performance, and that it is not indifferent to choosing a male or a female CEO in terms of company performance. Practitioner/Policy Implications: This study offers an insight to practitioners and policy makers suggesting that gender influences the relationship between the CEO and Vice-Presidents compensation gap and company performance. Boards may be able to improve company performance if they limit the compensation gap between CEO and VPs when the CEO is a female and extend it, when it is a male.

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Section: Methodsmentioning

confidence: 99%

Gender, Top Management Compensation Gap, and Company Performance: Tournament versus Behavioral Theory

Vieito

2011

Corporate Governance

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“…For the present study, sales have been used as a proxy for size of the firm. (Sridharan, 1996) [18].…”

Section: Performance As a Determinant Of Ceo Compensationmentioning

confidence: 99%

Determinants of CEO Compensation

Khanna¹

2016

International Journal of Management Excellence

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“…Murphy (1999) realiza una excelente revisi on de la literatura de las remuneraciones de los consejeros ejecutivos. Sridharan (1996) document o que la remuneraci on del consejero delegado de la empresa se incrementaba a medida que aumentaba la presencia de consejeros ejecutivos en el consejo de administraci on. Asimismo, O'Reilly et al (1988), Faleye (2011) y Li y Qian (2011) muestran una asociaci on positiva entre los consejeros ejecutivos que conforman las comisiones de retribuciones y las retribuciones de los consejeros delegados de la firma.…”

Section: Literatura Previa E Hip Otesis Del Estudio 21 Composici On unclassified

“…Murphy (1999) makes an excellent literature review of the executive directors' remunerations. Sridharan (1996) documented that the remuneration of the company's managing directors increases as the presence of executives directors increased in the board of directors. Likewise, O'Reilly et al (1988), Faleye (2011) and Li and Qian (2011) show a positive association between the executive directors which compose the remuneration committees and the firms' managing directors remunerations.…”

mentioning

confidence: 97%

The compensation committee and the remuneration of the directors

Pucheta‐Martínez

Narro‐Forés

2014

Academia Revista Latinoamericana De Administración

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CEO Influence and Executive Compensation

Cited by 48 publications

References 13 publications

Gender, Top Management Compensation Gap, and Company Performance: Tournament versus Behavioral Theory

Gender, Top Management Compensation Gap, and Company Performance: Tournament versus Behavioral Theory

Determinants of CEO Compensation

The compensation committee and the remuneration of the directors

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