Corporate governance in South Korea: the chaebol experience

Campbell, Terry L.; Keys, Phyllis Y.

doi:10.1016/s0929-1199(01)00049-9

Cited by 130 publications

(72 citation statements)

References 26 publications

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“…Our study rejects this possibility by showing that pay-performance sensitivities are also non-existent for Chaebol firms whereas they do exist for non-Chaebol firms in Korea. As such, our study complements Campbell and Keys (2002), together making a strong case that Chaebol firms in Korea do not have well functioning internal corporate governance. 33 As such, the present Korean corporate governance reform efforts that are aimed at Chaebol firms seem to be supported by evidence.…”

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confidence: 64%

“…31 The adoption of compensation committee and the disclosure of individual director's cash compensation are being considered in a similar context. 32 Campbell and Keys (2002) point to poorer corporate governance of Chaebol firms as compared to non-Chaebol firms by showing that Chaebol firms underperform non-Chaebol firms financially and that top executive turnover is not significantly related to firm performance for Chaebol firms whereas it is for non-Chaebol firms. Linking executive turnover to firm performance is, however, not the only internal corporate governance mechanism to discipline poorly performing top managers and reward well performing top managers, and hence alleviate the agency problem.…”

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confidence: 98%

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Executive Compensation, Firm Performance and Chaebols in Korea: Evidence from New Panel Data

Kim

Kato

Lee³

2005

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. This paper provides the first rigorous econometric estimates on the pay-performance relations for executives of Korean firms with and without Chaebol affiliation. To do so, we have assembled for the first time panel data (that provide information not only on executive compensation and firm performance but also on Chaebol affiliation) for 246 firms that were included in KOSPI200 for at least two consecutive years from 1998 to 2001. Contrary to a popular belief that Korean corporate governance and the structure of Korean executive compensation is considerably different from elsewhere in the West, we find that cash compensation of Korean executives is statistically significantly related to stock market performance and that the magnitude of the sensitivity of pay to stock market performance is comparable to the U.S. and Japan. Perhaps even more importantly, further analysis reveals for the first time that such overall significant executive pay-performance link is driven by nonChaebol firms and that no such link exists for Chaebol firms. The evidence is consistent with the recent literature on the nature of Chaebols in Korea and the current corporate governance reform efforts in Korea that are aimed mostly at Chaebol firms. Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E SJEL Classification: M52, M12, G30, G15, J33, O53

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confidence: 64%

mentioning

confidence: 98%

Executive Compensation, Firm Performance and Chaebols in Korea: Evidence from New Panel Data

Kim

Kato

Lee³

2005

SSRN Journal

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“…According to some of experts, due to different reasons, the presence of external shareholders in formation of ownership can provide performance improvement and productivity increase and company's value as below: -Supervision over managers; -Increasing expertise and experience of company management; -entry of new capitals and increasing flexibility and financial capacity of the company Facilitation and speeding up linking companies to global capital markets and decrease of capital cost rate (Campbell, 2002).The results of research by Aydin, N. Sayim, M. and A. Yalama in Turkish companies that are having external ownership indicate that external ownership companies, in terms of their capital return, are working better than companies having internal ownership. The evidences of this research support the hypothesis that cooperation with external ownership improves company's performance.…”

Section: Composition Of the Board Of Directors And Foreign Shareholdementioning

confidence: 99%

Structure of Board of Directors and Company’s Performance

Khansalar¹,

Dasht-Bayaz²,

Maboodi³

2015

IJBM

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The formation of shareholders or board of directors' structure is considered as one of important issues of corporate governance that impacts the motivation of managers. We shall consider that the impact of board of directors' ownership structure on the performance and productivity of corporate is a multidimensional and complicated issue. For this reason, we can expect all kinds of conflicts and contradictions of interests among people and groups, including conflict of interest among owners and managers, shareholders and creditors, real and legal shareholders, internal and external shareholders and…In this regard, there are extensive researches about the impact of board of directors' ownership and managers on the performance ad the value of a company within different countries and researchers have achieved different results and conflicts. Regarding many researches in this field, this research by using descriptive-analytical method has studied the impact of board of directors' structure and features on the performance of corporate within companies listed in Tehran stock exchange. The results indicate that there is a positive and significant relation among CEO duality and company's performance, also here is no any significant relation between board of directors' adherence and company's performance.

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“…These types of strong relationships are believed to be critical to prevent opportunism, to foster trust, and to encourage commitment from all involved parties (Feenstra et al, 1999;Campbell & Keys, 2002). An alternative perspective of collaborative networks, the Dispersed Network Manufacturing or DMN paradigm, describes how companies may address highly variable changes to markets and competition by entering into loosely connected networks alliances with other companies to obtain access to more diversified resources.…”

Section: Dispersed Manufacturing Network Explainedmentioning

confidence: 99%

“…"Third Italy" (Brusco, 1982;Amin, 1999;Hadjimichalis, 2006) Japanese Keiretsu (Anchordoguy, 1990;Minor et al, 1995;Feenstra et al, 1999) Korean Chaebol (Chang, 1988;Campbell & Keys, 2002) (Magretta & Fung, 1998;Noori & Lee, 2006;Shi, 2009;Tse et al, 2009) However, this does not mean that companies are transacting only in one-shot deals with total strangers. On the contrary, the various companies in such a network are typically engaged in long-term relationships with one another.…”

Section: Characteristicsmentioning

confidence: 99%