Determinants and value relevance of UK CEO pay slice

Al‐Najjar, Basil; Ding, Rong; Hussainey, Khaled

doi:10.1080/02692171.2015.1105938

Cited by 4 publications

(5 citation statements)

References 52 publications

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“…In addition, 14 our proxy for CEO power better captures top managerial talent and the concentration of decision making. Our finding is consistent with that of Al-Najjar et al (2016), suggesting that powerful CEOs have a higher CPS because of their superior talent and skills, which leads the firms they manage to reach high levels of financial performance and to engage in environmental actions.…”

Section: Multivariate Regression Analysessupporting

confidence: 89%

“…This suggests that the power of CEOs is attributable to their greater managerial skills rather than their rent-extracting abilities. Al-Najjar et al (2016) also show that higher CPS levels indicate a CEO's talent and ability to foster stronger firm performance.…”

Section: Ceo Power and Ep: Exploring The Role Of Financial Performancementioning

confidence: 80%

“…Following Bebchuk et al (2011), we use the industry median-adjusted CPS as our instrument (Jiraporn and Chintrakarn, 2013;Jiraporn et al, 2014). We also include control variables that are known to influence CEO power, such as the firm's size, debt, dividend ratio, and corporate governance quality (Bebchuk et al, 2011;Al-Najjar et al, 2016). We further test the validity of our instrument by performing Sargan's (1958) overidentification test; because Sargan's statistics are not significant, the selected instrument is valid.…”

Section: Robustness Checksmentioning

confidence: 99%

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How do powerful CEOs influence corporate environmental performance?

et al. 2021

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Section: Multivariate Regression Analysessupporting

confidence: 89%

Section: Ceo Power and Ep: Exploring The Role Of Financial Performancementioning

confidence: 80%

Section: Robustness Checksmentioning

confidence: 99%

See 1 more Smart Citation

How do powerful CEOs influence corporate environmental performance?

et al. 2021

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“…Table 2 shows an overview of the board's characteristics for the sample firms during the study period (2004)(2005)(2006)(2007)(2008)(2009)(2010)(2011)(2012)(2013) Two dummy variables to control for insurance line of business; one to indicate selling life insurance and the other to indicate selling nonlife insurance. Therefore, life dummy is assigned "1" and non-life dummy is assigned "0" for life insurance firms, while for non-life insurance firms, non-life dummy is assigned "1" and the other one "0" Al-Najjar and Hussainey (2016) Listing Status (Listed, Non-Listed)…”

Section: Descriptive Statisticsmentioning

confidence: 99%

Corporate governance and performance in the UK insurance industry pre, during and post the global financial crisis

Abdoush

Hussainey²,

Albitar³

2022

IJAIM

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Purpose Due to stakeholders’ concerns on the contribution of corporate governance in monitoring insurance companies during financial crisis, this study aims to investigate whether and how various corporate governance practices would have affected firm performance of listed and non-listed insurance firms in the UK during financial crisis. Design/methodology/approach This study uses a unique manually collected data set from listed and non-listed insurance firms in the UK and applies different regressions models to test the hypotheses and to address the endogeneity problem. Findings The findings show that board non-duality and the presence of a majority shareholder improve firm performance in insurance companies. Furthermore, the findings for the sub-samples indicate a stronger positive association between board of directors and firm performance in listed insurance companies after the financial crisis, while a positive impact has been found between large shareholders and external audit firms in non-listed insurance companies before and during the crisis. Practical implications The results offer important practical implications for the government, management, shareholders and policymakers. For example, regulators and policymakers should benefit from these results to revise the recommendations for corporate governance mechanisms that prove to be effective on firm performance, as well as those mechanisms that have different or unexpected effects among listed or non-listed firms and/or during the turbulent periods. Investors should be aware of those specific corporate governance mechanisms that would have higher effect on performance of UK insurance firms in which they are considering to invest in. Originality/value This study contributes to the current literature by exploring the effect of corporate governance on financial performance by comparing between listed and non-listed insurance companies during financial crisis. Further, to the best of the authors’ knowledge, this is the first study to use two new insurance-related performance measures, the revenue growth ratio and the adjusted combined ratio, as performance proxies to explore whether these new variables create any insights.

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“…Findings of Liu et al (2020) suggest that as firm leverage reaches a certain level, further incentive cannot motivate the executives to adopt more aggressive debt policy. Alternatively, a few studies such as Al-Najjar et al (2016) and Elsayed and Elbardan (2018) have observed an insignificant relation between leverage and compensation.…”

Section: Literature Reviewmentioning

confidence: 99%

Determinants of CEO compensation: evidence from Pakistan

Khursheed

Sheikh

2022

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Purpose The purpose of this paper is to investigate the impact of firm-specific (i.e. firm size, profitability, leverage, dividend, growth opportunities, management quality and firm age) and country-specific (i.e., gross domestic product [GDP] growth) variables on compensation/remuneration offered to chief executive officers (CEOs) working in different industries of Pakistan. Design/methodology/approach Panel data techniques, namely, pooled ordinary least squares, fixed effects and random effects methods are used to estimate the results. Moreover, Hausman test is used to choose which estimation method, either fixed effects or random effects, is better to explain the results. Findings Firm size, profitability, leverage, growth opportunities and age are some important firm-specific factors that have mixed (i.e. positive/negative) impact on CEO compensation in different industries. Variations in results are due to industry dynamics. However, it is important to mention that three key variables, namely, dividend, management quality and GDP growth have shown consistent positive impact on CEO compensation in most of the industries. In sum, results show that firm-specific and country-specific variables have material effects on CEO compensation. Moreover, results are found consistent with the predictions of agency theory and human capital theory. Practical implications The authors are sure that findings of this study provide some support to the board of directors to determine the pay slice for CEOs. Moreover, findings provide support to the regulatory authorities in formulating mechanisms to determine the compensation package for CEOs working in different industries and to improve the Code of Corporate Governance. Originality/value To the best of the authors’ knowledge, no empirical study in Pakistan has yet estimated the effects of firm-specific and country-specific variables on compensation offered to CEOs working in different industries. Thus, industry-wise analysis provides some new insights to the decision-makers and lays some foundation upon which a more detail analysis could be based.

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Determinants and value relevance of UK CEO pay slice

Cited by 4 publications

References 52 publications

How do powerful CEOs influence corporate environmental performance?

How do powerful CEOs influence corporate environmental performance?

Corporate governance and performance in the UK insurance industry pre, during and post the global financial crisis

Determinants of CEO compensation: evidence from Pakistan

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