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The growing acknowledgment of the need to transition to sustainability in corporate governance has led to the scrutiny of and the infusion of non-financial environmental, social, and governance (ESG) goals into the traditional incentive-based executive remuneration frameworks. The swift adoption of ESG metrics in executive compensation by global corporations and their endorsement by influential institutional investors and various regulatory bodies highlight this trend. This article challenges the effectiveness and necessity of universally applying standard ESG metrics in compensation structures and aims to construct a framework for a more contextual and nuanced application of ESG-linked executive compensation. The analysis highlights the limitations of ESG objectives unrelated to shareholder value and demonstrates the limited circumstances where some company specific ESG objectives can drive rapid changes in targeted performance by drawing attention to these objectives. These findings question the evolving practice of a uniform integration of ESG metrics in compensation plan design of all companies and urge regulators, institutional investors, and corporate boards to adopt a more tailored, focused, and selective strategy in integrating ESG metrics into executive pay. [ABSTRACT FROM AUTHOR]

Shareholder say-on-pay voting allows institutional investors to influence the incentives of managers and, consequently, corporate behaviour. Surprisingly, the preferences of investors on executive compensation have been largely overlooked in the ongoing debates on the role of say-on-pay in corporate governance and the impact of shareholder stewardship on sustainable corporate behaviour. The analysis of investor disclosed explanations of say-on-pay votes in the FTSE 100 companies during 2013–2021 shows that institutional investors rely repeatedly on several dominant themes aimed at improving the incentives of corporate managers and controlling managerial rent extraction. But shareholder interests remain the core focus of say-on-pay votes, with only few investors demanding that companies reward executive directors for protecting the interests of a broader range of affected stakeholders. Additionally, most investors can be grouped into several clusters formed around the voting recommendations of proxy advisers. A group of UK-based institutional investors stands out by taking a more individualistic and diverse approach to the stewardship of executive compensation. These findings highlight the role of local investors in the oversight of executive pay, the growing influence of proxy advisers along with the increasing share of foreign institutional investors, and the influence of best practice governance codes in driving investor stewardship preferences. [ABSTRACT FROM AUTHOR]

Abstract This research aims to investigate the moderating effect of environmental, social and governance (ESG) disclosure on the sensitivity of executive pay to market performance (pay-performance sensitivity - PPS) in Brazilian companies listed in the B3 IBrX-100 index. It also investigates the factors that influence PPS in order to seek explanations for the effect of ESG disclosure on PPS and to identify which theoretical perspective (agency theory, stakeholder theory, or the good governance view) can support the results found for Brazilian companies. It highlights the importance of monitoring ESG disclosure in the Brazilian capital market, as well as helping to understand whether or not ESG disclosure contributes to the extraction of shareholder income by executives, and provides insights for new research to be conducted considering ESG disclosure. The results have implications for understanding the principal-agent relationship and for understanding ESG disclosure in conflict mitigation when used by companies to improve PPS. A total of 81 companies were analyzed between 2016 and 2021. The method used for the main analyses was the ordinary least squares regression model (with robust standard errors), while quantile regression was used for the robustness analysis. The results indicate that ESG disclosure maximizes the sensitivity of executive pay to market performance. This study contributes to the literature by providing new evidence on PPS and identifying which theoretical perspective supports the results found in the Brazilian context. It also contributes to organizations by showing that ESG investments can mitigate agency problems and by revealing the importance of ESG implementation for firms, given the evidence of a positive impact on PPS. It contributes to society by encouraging organizations to invest in ESG issues.

The authors investigate what determines differences in change in pay between men and women executives who move to new employers. Using proprietary data of 2,034 executive placements from a global search firm, the authors observe narrower pay differences between men and women after job moves. The unconditional gap shrinks from 21.5% in the prior employer to 15% in the new employer. After controlling for typical explanatory factors, the residual gap falls by almost 30%, from 8.5% at the prior employer to 6.1% in the new placement. This change reflects a relative increase in performance-based compensation for women and a lower level of unexplained pay inequality generally in external placements. Controlling for individual fixed effects, observed women have higher pay raises than do men. Finally, the authors find suggestive evidence that pay differences may also be moderated by differences in the supply and demand for women executives. [ABSTRACT FROM AUTHOR]

This research aims to investigate the moderating effect of environmental, social and governance (ESG) disclosure on the sensitivity of executive pay to market performance (pay-performance sensitivity - PPS) in Brazilian companies listed in the B3 IBrX-100 index. It also investigates the factors that influence PPS in order to seek explanations for the effect of ESG disclosure on PPS and to identify which theoretical perspective (agency theory, stakeholder theory, or the good governance view) can support the results found for Brazilian companies. It highlights the importance of monitoring ESG disclosure in the Brazilian capital market, as well as helping to understand whether or not ESG disclosure contributes to the extraction of shareholder income by executives, and provides insights for new research to be conducted considering ESG disclosure. The results have implications for understanding the principal-agent relationship and for understanding ESG disclosure in conflict mitigation when used by companies to improve PPS. A total of 81 companies were analyzed between 2016 and 2021. The method used for the main analyses was the ordinary least squares regression model (with robust standard errors), while quantile regression was used for the robustness analysis. The results indicate that ESG disclosure maximizes the sensitivity of executive pay to market performance. This study contributes to the literature by providing new evidence on PPS and identifying which theoretical perspective supports the results found in the Brazilian context. It also contributes to organizations by showing that ESG investments can mitigate agency problems and by revealing the importance of ESG implementation for firms, given the evidence of a positive impact on PPS. It contributes to society by encouraging organizations to invest in ESG issues. [ABSTRACT FROM AUTHOR]

Purpose: The purpose of the paper is to explore the long-run impact of board governance and bank performance on executive remuneration. More specifically, the study addresses two objectives. First, the authors investigate the long-run relationship between pay and performance hold for the Indian banking industry. Second, the authors explore the moderating role of the board in explaining the relationship between executive pay and performance. Design/methodology/approach: The study uses multivariate panel co-integration approaches, i.e. fully modified and dynamic ordinary least square, to explain the co-integrating relationship between executive pay, governance and performance of Indian banks. The analysis is conducted for the period from 2005 to 2018. Findings: The results of co-integration tests reveal a long-run relationship between executive pay, board governance and bank performance. The long-run estimates produce evidence in favour of the dynamic agency theory, suggesting that the implications of asymmetric information can be mitigated by associating the current executive pay with the bank performance in the previous periods. The finding of this study reveals that improvements in the board quality serve as a monitoring tool to constrain excessive pay and moderate the executives' pay. Furthermore, the interaction of performance and board governance negatively impacts pay, supporting a substitution approach. It implies that setting optimal pay packages for executives necessitates enhanced and efficient board governance practices. Practical implications: The study recommends significant policy implications for regulators and the board of directors that executive pay significantly responds to the bank's performance and good board governance practices in the long run. Originality/value: This paper provides novel evidence of long-run pay-performance-governance relation using a panel co-integration approach. [ABSTRACT FROM AUTHOR]

This paper provides initial evidence on executive pay in small private limited liability firms in Germany. More than 80% of the firms report fewer than 50 employees. We find that executive pay increases with firm size and variable pay. We also find weak evidence that executive pay is lower in the presence of female executives, and increases with profitability. Surprisingly, variable pay is related in an inverted U-shape to total salary. Significant executive ownership (> 25%) is associated with higher compensation. Executive pay varies widely by region. Some, but not all results are in line with efficient contracting theory. In sum, we provide novel evidence on executive pay in small private firms outside the U.S. [ABSTRACT FROM AUTHOR]

Purpose: The purpose of this paper is to examine how and why individuals involved in executive remuneration (top pay) decision-making consider quantum as being appropriate rather than excessive, theorised under the rubric of accountability. Design/methodology/approach: In-depth interviews were conducted with non-executive directors (NEDs) serving on remuneration committees (Remcos), institutional investors, their external advisers and internal HR reward experts. Transcripts were analysed using NVivo and the Gioia qualitative methodology. Findings: Defining, measuring and applying performance conditionality in the determination of top pay quantum such that it aligns with company strategy/culture and values, as well as individual recipient motivations, is difficult. While creative approaches to setting top pay so as to attract, retain and motivate key personnel are welcomed, these risk Remco members' personal/organisational reputations. Members recognise disconnection between top pay quantum and general pay levels and how the media highlights social inequality leading to public distrust. They believe they can contribute to more socially acceptable quantum by applying their own values in top pay decision-making. Originality/value: Sanctions-based, trust-based and selection/peer networks/felt-based accountability theory is used to explain decision-makers' actions when determining top pay quantum. This paper extends felt accountability theory to encompass public/societal accountability in the context of the appropriateness of top pay quantum decisions. [ABSTRACT FROM AUTHOR]

The authors assert that broad-based stock options create a social exchange relationship between the employer and employees, leading to higher individual job performance in the next period. They compare this social exchange hypothesis to the more typical incentive-based explanation for stock options, which is that holding options generates financial incentives for better individual job performance in the current period. Findings show that significant and meaningful relationships are associated with social exchange effects and that these are both independent of incentive effects and arguably greater than those for the incentive effects. The authors use non-parametric and parametric fixed effects models, other controls for sample heterogeneity, and alternative specifications to address possible concerns about identification and endogeneity. These results extend empirical studies of social exchange relationships to common workplace practices. They also raise the possibility that some of the performance effects attributed to incentives in other studies may actually be attributable to social exchange effects. [ABSTRACT FROM AUTHOR]

In this article, the author studies the strategic interaction between employee stakeholders, in particular labor unions, and top management, and he evaluates the effect of the two parties' inherent competitive rent-seeking behavior on CEO pay. Using a panel of firms listed on the S&P/TSX Composite Index, the author shows that CEO compensation withstood the financial crisis (2008-2011) despite lower and even negative corporate performance. Further, highly unionized companies were associated with higher CEO pay in terms of non-equity elements such as salary and pension allocations. The presence of unions had no observed effect in reducing bonuses, stock options, and restricted stock units. These findings have implications for the debate on income inequality and the power of unions to bring about change. [ABSTRACT FROM AUTHOR]

We study the influence of the corporate board network on executive pay for 3,395 US firms between 1990 and 2015. We identify three elementary structures through which the interlocking network reflects forms of inter-group reciprocity across firms: restricted exchange, when two executives sit on each other's respective boards; delayed exchange, when y sits on the board of x after the end of x's mandate on the board of y; and generalized exchange, when x sits on the board of y, who sits on the board of z, who sits on the board of x. These ties, which are overrepresented, are related to higher executive pay, but are not related to firm performance, which we interpret as a form of rent extraction. We use the Sarbanes-Oxley Act (2002) as a natural experiment to confirm our results. The impact on pay disappears after 2004, once these types of exchanges are constrained. [ABSTRACT FROM AUTHOR]

This paper traces the career of Michael Jensen, a Chicago finance PhD turned Harvard Business School professor to reveal the intellectual and social conditions that enabled the emergence and institutionalization of what we call the “neoliberal common sense of capital,” what others have called the “shareholder value” view of the American firm. Jensen’s work was embraced by a generation of corporate raiders aggressively advancing new financial practices and discourses. His contribution, commonly understood as “agency theory,” was intertwined with the transformations in corporate management and governance of the last decades of the twentieth century—from the junk bond market in the 1980s to the exponential growth of CEO pay in the 1990s to the shareholder value management strategies of the 2000s. While debates about the spread of neoliberal ideas and governance tools have largely centered on the transformations of the state and international institutions or the role of actively organized intellectual networks, this essay emphasizes the importance of identifying specific carriers of particular transformations within the space of American “business discourse”.

This article analyses the nature of policy debates on financial regulation during the onset of the Global Financial Crisis (GFC) by considering three elements that shape them: the salience of the debate, the actors that dominate the debate, and the degree of anti-status quo pressure. Theoretically, it contributes to Culpepper's quiet/noisy politics framework by clarifying its multidimensionality and explicitly introducing the degree of contestation. Empirically, it focuses on two regulatory issues: (1) the restriction of banking and financial activities and (2) the debate on the remuneration of bankers. The data captures political claims during the first 12 months of the GFC and covers 19 established democracies. The findings indicate that policy debates were unevenly politicized across countries and issues, and that structural factors are not enough to account for the observed variation in pressure for reform for all types of actors, thus constituting a puzzle for further research. [ABSTRACT FROM AUTHOR]

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In order to ensure profitability for shareholders, optimal contracting recommends the alignment between executive compensation and company performance. Large organizations have therefore adopted executives remuneration systems in order to induce positive market reaction and motivate executives. Complex compensation schemes are designed by Boards of Directors using strong pay-performance incentives that explain high levels of executive pay along with company size, demand for management skills and executive influence. However, the literature remains inconclusive on the pay-performance relationship owing to the various empirical methods used by researchers. Additionally, there has been little effort in the literature to compare methodologies on the pay-performance relationship. Using the dominant agency theory framework, the purpose of this study is to establish and examine the relationship between firm performance and executive pay. In addition, it intends to assess the characteristic of model specifications commonly adopted. To this aim, a quantitative analysis consisting of three complementary methods was performed on panel data from South African listed companies. The results of the main unrestricted first difference model indicate a strong non-linear relationship where the impact of current and previous firm performance on executive pay can be observed over 2 to 4-year period providing support to the optimal contracting theoretical perspective in the South African business context. In addition, CEO pay is more sensitive to firm performance as compared to Director pay. Lastly, although it affects executive pay levels, company size is not found to improve the pay-performance relationship.

This article examines the concept of employee-based brand equity–the value that a brand provides to a firm through its effects on the attitudes and behaviors of its employees–and empirically demonstrates its significance on executive pay. Executives value being associated with strong brands and, therefore, accept substantially lower pay at firms that own strong brands. Consistent with identity theory, this effect is stronger for chief executive officers and younger executives than for other executives. Data from a large, cross-industry sample of executives suggest that academics and practitioners should take a broader view of the contributions of brand-related investments to firm value and make use of strong brands in pay negotiations that are typically viewed as being outside the realm of marketing. [ABSTRACT FROM AUTHOR]

Orientation: Executive pay has been increasing; however, company performance has not been increasing proportionally. This could be due to an agency problem, resulting in executive pay not aligning with the shareholders’ desired company performance. Research purpose: The purpose of this research was to establish if there was a relationship between the total pay of the chief executive officer and their company’s financial performance in South African Schedule 2 state-owned entities (SOEs). Motivation for the study: A review of literature revealed conflicting views regarding the relationship between executive pay and company financial performance. There were limited studies conducted in South Africa, especially considering SOEs. Research approach/design and method: This research was a quantitative, archival study using 8 years of secondary data from South African Schedule 2 SOEs. Spearman’s rank-order correlation was used to evaluate the relationship. Main findings: One significant weak positive relationship was observed when considering the net profit or loss metric of financial performance. Hence, there was no conclusive relationship between executive pay and company financial performance, which supported the proposition that there is an agency problem in South African SOEs. Practical/managerial implications: There is a distinct need for an all-encompassing SOE legislation framework to standardise pay structure and reporting requirements. Additionally, accurate measures of performance are necessary to overcome the agency problem. Contribution/value-add: This research adds to the limited knowledge base regarding the relationship between executive pay and company financial performance in South African SOEs. It also identified the need to incorporate non-financial metrics to influence executive pay.

Remuneration for chief executives in UK higher education—known as Vice Chancellors (VCs)—has been on an upward trend in recent years, and VCs have received criticism that their performance does not warrant such reward. We investigate the relationship between VC pay and performance (rooted in principal agent theory), taking into account an array of other possible determinants. Deriving measures of VC performance is difficult as VCs are agents for various principals, and each principal may be interested in a different aspect of performance. We consider three measures of VC performance here: managerial efficiency as measured by data envelopment analysis; performance in university rankings produced by the media; the financial stability of the university. We construct a comprehensive data set, covering academic years 2009/2010 to 2016/2017, a period of considerable change in the UK higher education sector including rapidly-rising undergraduate tuition fees. Our results show that, once other possible determinants of VC pay are taken into account, the main measure of performance which affects VC pay is the one based on media rankings. Thus the agents (VCs) appear to be rewarded for delivering against this performance benchmark which is likely to be of interest to a variety of principals. This result however varies by type of university suggesting that the labour market for VCs differs by mission group. [ABSTRACT FROM AUTHOR]

This paper first employs principal component analysis technique to develop and introduce an alternative UK corporate governance disclosure index to the US‐centric ones. Second, we then investigate whether this new corporate governance disclosure index can determine the level of executive pay (including CEOs, CFOs, and all executive directors) in UK listed firms, and consequently ascertain whether the governance mechanisms can moderate the pay‐for‐performance sensitivity. Employing data on corporate governance, executive pay and performance from 2008 to 2013, we find that, on average, better‐governed firms tend to pay their executives lower compared with their poorly‐governed counterparts. Additionally, our findings suggest that the pay‐for‐performance sensitivity is generally positive, but improves in firms with high corporate governance quality, implying that the pay‐for‐performance sensitivity is contingent on the quality of internal governance structures. We interpret our findings within the predictions of optimal contracting theory and managerial power hypothesis. [ABSTRACT FROM AUTHOR]

With the help of a simple question juxtaposing geared and ungeared positions, this paper analyzes the inherent ambiguity present in the concept of financial leverage. The answer to this question depends on the way it is (often automatically) understood. It may be perceived as being either about risk, risk reward or a mix of the two. The range of possible answers is virtually unlimited. Unfortunately, most of them, including that given by Miller in his Nobel Prize Lecture, are inconsistent with finance theory. This paradox is represented by the inability to answer the simple question in an unambiguous way, yet its gravity comes from the fact that it is neither noted nor debated in the literature. The confusion surrounding financial performance evaluation, ROE debate or executive pay are just a few examples of how lethal the leverage paradox can be. The leverage-driven financial crisis of recent years shows that the chaos in the literature exemplified by the paradox may easily spill over into real life. [ABSTRACT FROM AUTHOR]

Say on Pay is a corporate governance mechanism required by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The mechanism gave hope for control of an agency and managerial power problem. The problem focused on executive pay that appeared to be higher than necessary for efficient business operations in companies where agency problems caused a residual loss exacerbated by managerial power. The problem was addressed by requiring public companies to give their stockholders the opportunity to review and comment on executive pay with non-binding votes called Say on Pay. The objective of this study is to look for evidence that Say on Pay reduced the impact of agency and managerial power problems by reducing executive pay. A search for reductions in executive pay was done in large U.S. companies by comparing levels of executive pay before and after Say on Pay. Levels of executive pay are examined as ratios of pay to size, pay to earnings, and pay to overhead expense. The results are consistent with agency and managerial power theories because most pay ratios fell after the implementation of Say on Pay voting. Pay ratios fell the most in companies whose pay ratios were the highest before the implementation of Say on Pay. [ABSTRACT FROM AUTHOR]

Departing from previous studies, this paper investigates the impact of corporate board diversity on corporate performance and executive pay within the context of Middle East and North African countries. Our sample includes a balanced panel of 600 firm‐year observations, consisting of 100 individual firms drawn from five Middle Eastern countries (Egypt, Jordan, Oman, Saudi Arabia, and United Arab of Emirates) over the 2009–2014 period. The findings are three‐fold. First, board diversity, as measured by director gender and nationality, has a positive effect on corporate financial performance. Second, the relationship between board diversity and corporate performance is stronger in better governed firms than their poorly governed counterparts. Finally, board diversity, as measured by director gender, ethnicity, and nationality, enhances the pay‐for‐performance sensitivity but not the actual executive pay. Our results suggest that decisions about board diversity are not merely influenced by moral values; they arise because of the cost–benefit considerations of what diversity can bring to the firm. The findings are robust to controlling for different alternatives of board diversity measures, corporate governance proxies, corporate outcomes, and types of endogeneities. [ABSTRACT FROM AUTHOR]

This paper examines the crucial question of whether chief executive officer (CEO) power and corporate governance (CG) structure can moderate the pay-for-performance sensitivity (PPS) using a large up-to-date South African data-set. Our findings are threefold. First, when direct links between executive pay and performance are examined, we find a positive, but relatively small PPS. Second, our results show that in a context of concentrated ownership and weak board structures; the second-tier agency conflict (director monitoring power and opportunism) is stronger than the first-tier agency problem (CEO power and self-interest). Third, additional analysis suggests that CEO power and CG structure have a moderating effect on the PPS. Specifically, we find that the PPS is higher in firms with more reputable, founding and shareholding CEOs, higher ownership by directors and institutions, and independent nomination and remuneration committees, but lower in firms with larger boards, more powerful and long-tenured CEOs. Overall, our evidence sheds new important theoretical and empirical insights on explaining the PPS with specific focus on the predictions of the optimal contracting and managerial power hypotheses. The findings are generally robust across a raft of econometric models that control for different types of endogeneities, pay, and performance proxies. [ABSTRACT FROM AUTHOR]

In this paper we investigate the under-researched topic of the use of executive share-based compensation in Poland, and we analyse empirically whether theoretical explanations developed and applied mainly in the context of developed countries also hold in this specific context. Building on agency and institutional theories we study the determinants of using executive share-based pay in 362 companies listed on the Warsaw Stock Exchange. As a result, we highlight the role of the state in Polish firms and the need to consider specifically principal–principal conflicts typical of emerging economies in post-state-socialist organisational research. Our findings not only reflect particularities of the institutional environment in the country studied but also highlight the limits of the traditional principal–agent lens applied in emerging economies. [ABSTRACT FROM AUTHOR]

In this study, I consider a company's optimal use of relative performance evaluation (RPE) in principal/agent relations to filter out common risk. I construct a risk-parity aggregate of the company's peer group to be the sum of the ratios of the common- and idiosyncratic-risk components of the group of peers' outputs, scaled by the variance of the common risk. I demonstrate that this aggregate embodies the peer group's informativeness about the common risk, so it captures precisely the group's innate capability to trade off optimally between the common- and idiosyncratic-risk components of those peers' outputs. The optimal use of RPE therefore entails a partial substitution of the common risk with the peers' idiosyncratic risks. Moreover, the risk-parity aggregate enables us to identify a boundary condition, which helps us rule out ineffective uses of RPE that completely eliminate the common risk, thereby improving the statistical power of a strong-form RPE test. JEL Classifications: J3; M2. [ABSTRACT FROM AUTHOR]

No abstract available.

Executive pay relative to that of average workers has risen dramatically worldwide. Such a high level of executive pay raises the question of whether a steep rise in executive pay affects firm value. This study examined the relationship between executive pay and firm value. A panel smooth transition regression model is adopted to determine an optimal level of executive pay that maximizes firm value for a sample of 512 Taiwanese-listed firms over the period 2006-2011. The finding is that when the ratio of executive pay to net income after tax exceeds 2.71%, the firm value increases. The results suggest a correlation between large executive ownership (corresponding to high executive pay) and both increased operational efficiencies and firm value. These findings may be useful when contemplating executive compensation policy.

This article explores corporate responsibility for less income inequality within the boundaries of the organization and with regard to society at large. Instead of examining the entire range of income distribution, the focus is on the lower and upper ends. The 'floor' is defined as a living wage, supported by strong economic and ethical arguments and proposed as a minimal income standard that can - and thus should - be implemented by companies. As for the ethically acceptable 'ceiling' of executive compensation, its identification and justification are more complicated. However, strong economic and ethical arguments can be made in favor of a drastic reduction of executive pay. Corporate responsibility for less income inequality in society means, first, to 'walk the talk' and set an example and, second, to being 'a good corporate citizen' by supporting legislation for a living wage and an ethically acceptable ceiling of executive pay. [ABSTRACT FROM AUTHOR]

In virtually all economies, executive positions are highly male dominated. This study examines the pay gap between male executives and female executives in large Australian firms from 2011 to 2014 to evaluate whether female executives are paid equitably compared with male executives. The mean pay comparison shows that female executives earn 80.7% of the total pay earned by male executives. A large part of the gender pay gap is explained by differences in positions held; female executives are particularly underrepresented in highly paid executive positions. After controlling for executive position and other relevant individual and firm characteristics, there remains a 15.1% gender gap in total pay. Our findings suggest that to achieve the goal of gender equity, both the proportion of women at executive level and the executive-level gender pay gap need to be monitored. [ABSTRACT FROM AUTHOR]

There has recently been public discussion of the rewards available to senior staff in English and Welsh charities. However, that discussion is usually based on examples of individual salaries, or on unrepresentative and small subsets of the charity population. To provide a robust and informed basis for debate, we have conducted analyses of evidence on the payment of high salaries (defined as the numbers of people paid above £60,000 p.a., a reporting threshold used by the Charity Commission) in: (a) a representative sample of c.10,000 English and Welsh charities, and (b) surveys of individuals regarding comparative salary levels in different sectors of the economy. Overall, survey data show that the proportion of staff in receipt of high salaries is lower than average in the third sector than in other sectors. Information from charity annual accounts is used to demonstrate which charities are more likely than others to pay such salaries, and to relate the likelihood of paying high salaries to charity characteristics (income, location and subsector). We show that the distribution of high pay in the charitable sector is largely a function of the size and complexity of organisations, and is generally unrelated to subsector or income mix. [ABSTRACT FROM PUBLISHER]

Does the rise of the CFO as the second-ranked executive increase the status of the CEO? We find that, as a CFO becomes #2, a CEO receives higher pay in relative terms compared with other top executives. This result corresponds to the literature on span-of-control of executives in top management team. [ABSTRACT FROM AUTHOR]

The Netherlands adopted shareholders' say on pay over a decade ago. The general meeting of shareholders must approve the remuneration policy and any amendments to it. This Dutch approach offers fruitful insights into how say on pay works in practice. In the light of the recent European proposal to introduce a uniform say on pay, we examine the merits of the Dutch system. First, we describe the legal framework of the Dutch say on pay and its background. Then, using hand-collected voting data, information from the minutes of general meetings and ownership data for the entire Dutch say on pay period (2004-2014), we address and discuss both its direct and its indirect effects. Our study shows that, although remuneration proposals are seldom rejected, the influence of shareholders on the remuneration policy of the company is considerable. Furthermore, the Dutch approach to say on pay stimulates shareholders' dialogue and increases pressure on boards regarding remuneration matters, even in the presence of large insider shareholders. [ABSTRACT FROM AUTHOR]