CEO pay slice and firm value: evidence from UK panel data

摘要: Purpose The purpose of this paper is to examine the relationship between CEO pay slice (CPS) – fraction top five executive directors’ total compensation that captured by chief officer (CEO) and value firms in UK. Specifically, examines whether CPS alters effectiveness board performance influencing cooperation cohesiveness among its members. Design/methodology/approach This analyses a large sample non-financial companies listed on London Stock Exchange from 1997 2010. The empirical methodology includes analysis panel data using dynamic generalized method moments estimator. Findings The evidence supports social comparison theory demonstrates high likely impact negatively team’s spirit motivation. However, tournament argument supported when subsample with CEOs close retirement age has been analysed. In addition, findings suggest perform better after introduction non-binding say law UK 2002. Practical implications The results have major implications for on-going debate how reform remuneration, highlight importance considering remuneration issues at level, supporting principles Corporate Governance Code (Financial Reporting Council, 2010). Originality/value The indicate can provide useful tool research firm performance, relation an important issue be considered context. also board-wide without narrowing them down simply details compensation.