Determinants of the levels and changes in non‐executive director compensation

Bugeja, Martin; Fohn, Stephanie; Matolcsy, Zoltan

doi:10.1111/acfi.12093

Cited by 38 publications

(62 citation statements)

References 63 publications

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“…Company size and growth are related to higher pay and greater agency problems. Large or high growth companies tend to have complex operations, which result in higher demand for better‐quality managers who receive higher pay (Chen and Leng, ; O'Connell, ; Walker, ; Bugeja et al ., ; Ntim et al ., ). For our models that examine shareholder dissent, we include return on assets as a control because shareholders are likely to use their vote on remuneration to register their dissatisfaction with the board if performance is poor (Krause et al ., ).…”

Section: Methodsmentioning

confidence: 99%

Remuneration committees, shareholder dissent on CEO pay and the CEO pay–performance link

Kent

Kercher

Routledge

2016

Accounting & Finance

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We provide evidence on whether the adoption of the full Australian Securities Exchange recommendations for remuneration committee formation and structure are associated with a lower shareholder dissenting vote or a stronger CEO pay-performance link. We find some evidence that a minority-and majority-independent remuneration committee and a committee size of at least the recommended three members are associated with lower shareholder dissent. Companies with an independent committee have a stronger CEO payperformance link. In addition, a majority-independent committee strengthens the link between performance and growth in CEO pay.

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Section: Methodsmentioning

confidence: 99%

Remuneration committees, shareholder dissent on CEO pay and the CEO pay–performance link

Kent

Kercher

Routledge

2016

Accounting & Finance

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“…As more transparency is being required to public firms about individual director compensation, some recent papers such as Marchetti and Stefanelli (2009), Horton et al (2012), Bugeja et al (2016), Chen and Keefe (2018), Ferris et al (2018) or Fedaseyeu et al (2018) analyse the influence of director level variables such as their skills or abilities on their compensation, using Human Capital Theory as background for their hypotheses (Becker, 1964;Mincer, 1974).…”

Section: Introductionmentioning

confidence: 99%

Directors’ Compensation. What Really Matters?

Fraile

Fradejas

2020

Journal of Business Economics and Management

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In the current scenario of increasing social inequality, the debate over the compensation received by directors and executives of large listed companies, and its justification, has intensified. Drawing on Agency Theory and Human Capital Theory, a multilevel analytical technique is used in this paper to examine the influence of firm-level variables and director-level variables on the individual compensation of the members of the board. The results obtained for the continental European context (Spain in particular) partially support the Human Capital Theory. Nevertheless, there is no evidence supportive of Agency Theory, as corporate governance mechanisms do not contribute to moderate the compensation of directors and there is no relationship between corporate performance and the compensation of directors. The analyses by subsamples (categories of directors) reveal that non-executive director’s compensation seems to be set for a group of individuals as a whole, depending mainly on firm-level characteristics, whereas executive director compensation is more based on the unique characteristics that a particular executive brings to the board.

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“…We study the relation between NEDs' compensation and M&A activities within the Australian setting for a number of reasons. First, evidence in Bugeja et al (2014) indicates that the compensation of Australian NEDs is 'economically significant' and that 95% of firms have an independent director as the Chair of the Board, who on average receives almost twice the average compensation of the other NEDs. The high financial costs of this remuneration are suggestive of firms expecting additional benefits attributed to the greater monitoring and advising ability of NEDs.…”

Section: Introductionmentioning

confidence: 99%

Is non-executive directors’ pay or industry expertise related to takeover premiums, abnormal returns and offer price revisions?

Bugeja

Matolcsy

Mehdi

et al. 2016

Australian Journal of Management

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We examine the association between various takeover outcomes and bidding firm nonexecutive director (NEDs) compensation and expertise in the target firm industry. In our sample of 272 acquisitions by ASX listed firms between 2004-2011, we find that NEDs' relative compensation and industry expertise have a negative association with the bid premium. We also find that NEDs' relative compensation is positively associated with the bidding firm's market reaction to the takeover announcement, and NEDs' industry expertise is associated with a lower likelihood of an increase in the offer price, particularly for M&As viewed negatively by the market. These results are consistent with higher NEDs' relative compensation and industry expertise leading to more effective board monitoring and advising.

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Determinants of the levels and changes in non‐executive director compensation

Cited by 38 publications

References 63 publications

Remuneration committees, shareholder dissent on CEO pay and the CEO pay–performance link

Remuneration committees, shareholder dissent on CEO pay and the CEO pay–performance link

Directors’ Compensation. What Really Matters?

Is non-executive directors’ pay or industry expertise related to takeover premiums, abnormal returns and offer price revisions?

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