Three Essays on Executive Compensation - KOPS - Universität ...

More documents

Recommendations

Info

Which Pay for what Performance? Evidence from Executive Compensation in Germany and the United States It is not clear what determines long-term compensation in either country. We find weak evidence for a negative relation between stock returns and long-term compensation. An explanation for this unintuitive finding could be that long-term compensation such as company stock or options serve as discretionary grants providing extra incentives to increase firm value after years of weak performance. However, we do not find evidence for any pay-performance relation in the pre-crisis period. There is anecdotal evidence from annual reports that many German firms grant long-term compensation independent of past firm performance. Instead they set up long-term incentive plans and grant options, company stock, phantom stock etc. over several years to provide executives with incentives to increase firm performance. For long-term compensation of U.S. executives we find weak explanatory power of lagged stock market performance. Stock returns up to four years before the compensation year have some explanatory power in the U.S. sample, but this relation is weaker in the crisis period. Thus we are not very confident that lagged stock performance explains company stock and option grants, and thus cannot provide a robust explanation for what determines long-term oriented compensation. This not only sets an agenda for future research, it also shows where firms and regulators can help to improve transparency and thus our understanding of executive compensation. 97
Which Pay for what Performance? Evidence from Executive Compensation in Germany and the United States References Abowd, J. and Bognanno, M. (1995). International differences in executive and managerial compensation, in R. Freeman and L. Katz (eds), Differences and changes in wage structures, University of Chicago Press, pp. 67–104. Aggarwal, R. and Samwick, A. (1999). The other side of the tradeoff: The impact of risk on executive compensation, Journal of Political Economy 107(1): 65–105. Bebchuk, L. and Grinstein, Y. (2005). The growth of executive pay, Oxford Review of Economic Policy 21(2): 283–303. Bushman, R. and Indjejikian, R. (1993). Accounting income, stock price, and managerial compensation, Journal of Accounting and Economics 16(1): 3–23. Cichello, M. (2005). The impact of firm size on pay-performance sensitivities, Journal of Corporate Finance 11(4): 609–627. Clarke, K. and Stone, R. (2008). Democracy and the logic of political survival, American Political Science Review 102(3): 387–392. Conyon, M., Core, J. and Guay, W. (2011). Are US CEOs paid more than UK CEOs? Inferences from risk-adjusted pay, Review of Financial Studies 24(2): 402–438. Conyon, M. and Schwalbach, J. (1999). Corporate governance, executive pay and performance in Europe, in J. Carpenter and D. Yermack (eds), Executive compensation and shareholder value: Theory and evidence, Kluwer Academic Publishers, pp. 13–33. Conyon, M. and Schwalbach, J. (2000). Executive compensation: Evidence from the UK and Germany, Long Range Planning 33(4): 504–526. De Angelis, D. and Grinstein, Y. (2010). Pay for the right performance. Johnson School Research Paper 03-2011. Elston, J. and Goldberg, L. (2003). Executive compensation and agency costs in Germany, Journal of Banking & Finance 27(7): 1391–1410. Fahlenbrach, R. (2009). Shareholder rights, boards, and CEO compensation, Review of Finance 13(1): 81–113. 98
Page 1:
Three Essa
Page 4 and 5:
Contents Vorwort Contents List of T
Page 6:
CONTENTS 3.5.1 Determinants of the
Page 9 and 10:
LIST OF TABLES 2.9 Cash Bonuses and
Page 11 and 12:
Summary Chapter 1, Executive Compen
Page 13 and 14:
Summary top management’s cash-flo
Page 15 and 16:
Zusammenfassung nehmensmerkmale, so
Page 17 and 18:
Zusammenfassung zurückliegender Ja
Page 19 and 20:
Executive Compensation and Firm Per
Page 21 and 22:
Page 23 and 24:
Page 25 and 26:
Page 27 and 28:
Page 29 and 30:
Page 31 and 32:
Page 33 and 34:
Page 35 and 36:
Page 37 and 38:
Page 39 and 40:
Page 41 and 42:
Page 43 and 44:
Page 45 and 46:
Page 47 and 48:
Page 49 and 50:
Page 51 and 52:
Page 53 and 54:
Page 55 and 56: Executive Compensation and Firm Per
Page 69 and 70: Which Pay for what Performance? Evi
Page 105: Which Pay for what Performance? Evi
Page 123 and 124: Profit Sharing with Executives cash
Page 125 and 126: Profit Sharing with Executives 3.2
Page 127 and 128: Profit Sharing with Executives debt
Page 131 and 132: Profit Sharing with Executives Inve
Page 135 and 136: Profit Sharing with Executives tion
Page 137 and 138: Profit Sharing with Executives from
Page 139 and 140: Profit Sharing with Executives The
Page 141 and 142: Profit Sharing with Executives sect
Page 143 and 144: Profit Sharing with Executives a lo
Page 145 and 146: Profit Sharing with Executives vari
Page 147 and 148: Profit Sharing with Executives prot
Page 149 and 150: Profit Sharing with Executives mana
Page 151 and 152: Profit Sharing with Executives shar
Page 153 and 154: Profit Sharing with Executives the
Page 155 and 156: Profit Sharing with Executives Refe
Page 157 and 158:
Profit Sharing with Executives Larc
Page 159 and 160:
Profit Sharing with Executives Tabl
Page 161 and 162:
Page 163 and 164:
Page 165 and 166:
Page 167 and 168:
Complete References Bertrand, M. an
Page 169 and 170:
Complete References Frydman, C. and
Page 171 and 172:
Complete References Lambert, R. and
Page 173 and 174:
Erklärung Ich versichere hiermit,
show all

Three Essays on Executive Compensation - KOPS - Universität ...

Create successful ePaper yourself

Delete template?

Save as template?