Remuneração Executiva, Valor e Desempenho das Empresas Brasileiras Listadas

Abstract

The aim of this study is to identify the relationship between executive compensation, firm value and performance in Brazil. The literature provides mixed results but most studies show that firms with higher executive compensation tend to have greater value and performance in comparison with companies with lower compensation. We analyze a unique Brazilian database to test this hypothesis. This paper differs from previous studies on executive remuneration in Brazil since it uses dynamic models, estimated by systemic generalized method of moments, to control potential sources of endogeneity. The analysis of 420 Brazilian companies from 2002 to 2009 does not indicate a significant relation between executive compensation and firm value (price-to-book and Tobin´s Q), suggesting that companies that pay greater executive remuneration do not have higher value. Furthermore there is no significant relation between executive compensation and operational performance (ROA and sales growth).

Executive Compensation and Performance of Companies in the Brazilian Capital Market: Evidence of Negative Relationship with Focus on the Interests of the Controlling Shareholder

“…The result of this first hypothesis is consistent with the results of the studies conducted in Brazil by Silva and Chien (2013), Souza et al (2017), and Konraht et al (2018) who found no significant evidence between executive compensation and performance. They are also consistent with international studies such as those by Duffhues and Kabir (2008) and Barontini and Bozzi (2011), who found a negative relationship between executive compensation and company performance.…”

“…In Brazil, Silva and Chien (2013) found no significant evidence that companies that compensate their executives the most have better operating performance and higher value. Souza et al (2017) and Konraht et al (2018) also demonstrate the absence of statistical significance between executive compensation and market performance.…”

“…The Return on Assets (ROA) and Return on Equity (ROE) were used as variables related to accounting performance, as in the studies conducted by Canarella and Gasparyan (2008), Conyon andHe (2011), andChang et al (2012). To implement the variables concerning the company's value, Tobin's Q and the market value were used, according to the studies by Pukthuanthong et al (2004) and Silva and Chien (2013). Also, some independent variables such as ownership concentration and corporate governance were adopted.…”

Avaliação relativa de desempenho na compensação pecuniária de executivos: evidências empíricas no Brasil

“…In the research by Silva and Chien (2013), the return on assets (ROA) and the sales variation did not present statistically significant relationships with the remuneration, contrary to the market value of the firm. Ferreira (2012) performed several tests to analyze relations between firm size and remuneration and did not find significant relationships.…”

Remuneração dos Executivos e Desempenho em Empresas Brasileiras Familiares e Não Familiares

“…Nessa perspectiva, o desenho de um pacote de remuneração atrativo e compatível com a realidade do mercado, que apresente incentivos tanto de curto quanto de longo prazo e com metas claras de desempenho, é benéfico para a manutenção das relações entre acionistas e executivos (Silva & Chien, 2013). O que torna o fenômeno a ser observado ainda mais complexo é que os pacotes de compensação das empresas podem ser representados por inúmeros elementos, como salário-base, bônus anual, ações e opções de ações, seguros, benefícios de pensão e indenização (Georgen & Renneboog, 2011).…”