Session Details: Session 1096

Executive Compensation

Track F

Date: Monday, October 13, 2008

 

Time: 11:15 – 12:30

Paper

Room: Salon 22


Session Chair:
Katja Rost, University of Zurich

Title: CEO Total Wealth, Decision-Making and Firm Performance: An Empirical Investigation

Authors

  • Joanna Tochman Campbell, University of Cincinnati

Abstract: I propose that the impact of compensation on CEO risk propensity, decision-making, and subsequent firm performance is mitigated by the CEO’s total wealth. This may account for the conflicting findings of previous works, which have been unable to identify a consistent relationship between executive compensation and firm performance. I develop a measure of CEO wealth based on past compensation and consumption, and test the impact of this measure on the CEO’s current compensation, risk-taking, and subsequent firm performance, as well as the relationships between these variables.

Title: Corporate Governance: What Can Stock Corporations Learn Form Monasteries?

Authors

  • Katja Rost, University of Zurich
  • Margit Osterloh, Crema Vermoegensverwaltung & Research GmbH
  • Emil Inauen, University of Zurich
  • Bruno Frey, University of Zurich

Abstract: The weaknesses and failures of actual corporate governance practice suggest that it might be useful to approach the issue from a new perspective. In our paper we show that fresh insights for corporate governance can be gained from the way monasteries are organized.

Title: Executive Compensation, Financial Slack, and Strategic Risk-Taking: A Behavioral Agency Perspective

Authors

  • Elizabeth Lim, Georgia State University

Abstract: Drawing insights from Wiseman and Gomez-Mejia’s (1998) behavioral agency model, this paper examines how and why different forms of executive compensation separately and jointly with financial slack influence strategic risk-taking over time. Longitudinal data are collected from various archival databases, and consist of 98 firms in three high research and development industries spanning 14 years during the time period 1992-2005. The random coefficient modeling analytical technique based on growth modeling at the intra- and inter-firm levels is used to test the hypotheses that different forms of executive compensation exhibit dissimilar influences on strategic risk-taking, and that their influence changes as their values change. The hypotheses that different levels of financial slack influence the incentive properties of various forms of executive compensation to affect executives’ perceptions of risks are also tested.

Title: The Dark Side of Growing Intra-Firm Pay Dispersion in Knowledge-Intensive Economies

Authors

  • Flore Bridoux, University of Amsterdam

Abstract: In an era where knowledge has become a prominent source of value created for Western firms, the growing pay dispersion that has characterized American firms over the last three decades is spreading to European firms through the adoption of American governance practices. This paper contributes to the research on knowledge and governance by developing micro-foundations to study the impact of pay dispersion on employees’ motivation to create and deploy knowledge. This paper shows the negative consequences of growing pay dispersion for the creation and deployment of knowledge inside firms and warns against the blind adoption of American governance practices in Continental Europe where these negative consequences are likely to be even larger.

All Sessions in Track F...

Mon: 11:15 – 12:30
Session 1089: Make, Ally or Buy
Session 1096: Executive Compensation
Mon: 15:30 – 16:45
Session 1086: Alternative Views of Value Creation
Session 1090: CEO Pay
Session 1107: Executive and External Forces in Strategy
Mon: 17:00 – 18:15
Session 1091: Impression Management
Session 1098: Social Networks
Tue: 11:15 – 12:30
Session 1093: Succesion and Team Dynamics
Session 1103: Social and Human Capital
Tue: 14:30 – 15:45
Session 1095: Diversification
Session 1105: Governance Perspectives
Wed: 10:00 – 11:15
Session 1104: Managing Alliance Relationships
Session 1106: New Corporate Strategy Perspectives
Wed: 11:30 – 12:45
Session 1088: Acquisitive Growth Strategies
Session 1092: Dynamic Strategies and Resources


Strategic Management Society

Cologne Conference