The determinants and performance consequences of the CEO pay slice

Spiropoulos, H

The determinants and performance consequences of the CEO pay slice

Spiropoulos, H

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Publication Type:: Thesis
Issue Date:: 2013

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Field	Value	Language
dc.contributor.author	Spiropoulos, H
dc.date.accessioned	2014-03-25T01:09:31Z
dc.date.available	2014-03-25T01:09:31Z
dc.date.issued	2013
dc.identifier.uri	http://hdl.handle.net/10453/24185
dc.description	University of Technology, Sydney. Faculty of Business.	en_US
dc.description.abstract	There is an emerging literature which focuses on the proportion of the CEO’s pay as a percentage of all senior executives’ pay (the CEO pay slice). This literature tests the association between the CEO pay slice and different economic activities but stays silent on the key drivers of the observed variations in the CEO pay slice. This thesis develops a theoretical framework for the economic determinants of the CEO pay slice (CPS) and tests this framework using a sample of 9,978 U.S. listed firms for the period 2001-2010. This thesis also provides evidence on the performance consequences of firms with an inefficient CPS. The findings in this thesis indicate that the CPS reflects rational allocation of decision authority between the CEO and senior executives. This allocation of decision authority is driven by firms' economic characteristics including the degree of business diversification, R&D intensity, and growth options. The CPS also reflects the market for CEO talent. There is limited evidence that an inefficient CPS is related to subsequent firm performance. No relation is found between inefficient CPS and accounting returns, however a negative relation is found between inefficient CPS and subsequent market returns. This thesis finds no evidence supporting the alternative managerial power explanation of the CPS as no relation is found between the CPS and proxies for CEO power, or between the CPS and subsequent accounting or market based firm performance. The findings in this thesis are consistent with respect to a number of sensitivity tests.	en_US
dc.format	Thesis (PhD)	en_US
dc.language.iso	en	en_US
dc.relation	https://opus.lib.uts.edu.au/bitstream/10453/24185/2/02whole.pdf
dc.rights	info:eu-repo/semantics/openAccess
dc.rights	The author owns the copyright in this thesis including all reproduction and reuse rights for the work. The work may not be altered without the permission of the copyright owner. Attribution is essential when quoting or paraphrasing from this thesis.
dc.rights	au.edu.uts.lib/ppc
dc.subject	CEO pay slice.	en
dc.subject	Chief executive officers.	en
dc.subject	Salaries.	en
dc.subject	Performance	en
dc.title	The determinants and performance consequences of the CEO pay slice	en_US
dc.type	Thesis
utslib.copyright.status	open_access

Abstract:

There is an emerging literature which focuses on the proportion of the CEO’s pay as a percentage of all senior executives’ pay (the CEO pay slice). This literature tests the association between the CEO pay slice and different economic activities but stays silent on the key drivers of the observed variations in the CEO pay slice. This thesis develops a theoretical framework for the economic determinants of the CEO pay slice (CPS) and tests this framework using a sample of 9,978 U.S. listed firms for the period 2001-2010. This thesis also provides evidence on the performance consequences of firms with an inefficient CPS. The findings in this thesis indicate that the CPS reflects rational allocation of decision authority between the CEO and senior executives. This allocation of decision authority is driven by firms' economic characteristics including the degree of business diversification, R&D intensity, and growth options. The CPS also reflects the market for CEO talent. There is limited evidence that an inefficient CPS is related to subsequent firm performance. No relation is found between inefficient CPS and accounting returns, however a negative relation is found between inefficient CPS and subsequent market returns. This thesis finds no evidence supporting the alternative managerial power explanation of the CPS as no relation is found between the CPS and proxies for CEO power, or between the CPS and subsequent accounting or market based firm performance. The findings in this thesis are consistent with respect to a number of sensitivity tests.

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http://hdl.handle.net/10453/24185