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Board reputation, CEO pay, camouflaged compensation

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dc.affiliation.dptoUC3M. Departamento de EconomĂ­a de la Empresaes
dc.contributor.authorRuiz-VerdĂș, Pablo
dc.contributor.authorSingh, Ravi
dc.date.accessioned2011-12-07T12:08:53Z
dc.date.available2011-12-07T12:08:53Z
dc.date.issued2011-03-08
dc.description.abstractReputational concerns are arguably the single most powerful incentive for board directors to act in the interest of shareholders. We propose a model to investigate the impact of boards' reputational concerns on the level and structure of executive compensation, the use of camou aged pay, and the relation between board independence and compensation decisions. We show that, in order to be perceived as independent, boards lower managers' pay, but may also pay managers in hidden ways or structure compensation ine ciently. Interestingly, independent boards, not manager-friendly boards, are more likely to make use of hidden compensation. We apply our model to study the costs and bene ts of greater pay transparency and of measures, such as say-on-pay initiatives, that increase boards' accountability to shareholders.
dc.description.sponsorshipPablo Ruiz-Verd u gratefully acknowledges the nancial support of the Spanish Ministry of Science and Innovation for nancial support under grant ECO2009/08278. We thank seminar participants at the Swiss Finance Institute, the University of Texas at Austin, the European Financial Management Association Annual Conference (2010) and the XVIII Finance Forum for useful discussions and suggestions.
dc.format.mimetypeapplication/pdf
dc.identifier.urihttps://hdl.handle.net/10016/12720
dc.language.isoeng
dc.publisherSocial Science Research Network
dc.relation.ispartofseriesWorking paper series
dc.relation.ispartofseriesMarch 8, 2011
dc.relation.projectIDGobierno de España. ECO2009-08278
dc.rightsAtribución-NoComercial-SinDerivadas 3.0 España
dc.rights.accessRightsopen access
dc.rights.urihttp://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.subject.ecienciaEmpresa
dc.subject.otherExecutive compensation
dc.subject.otherBoard of directors
dc.subject.otherHidden pay
dc.subject.otherBoard reputation
dc.subject.otherBoard independence
dc.titleBoard reputation, CEO pay, camouflaged compensation
dc.typeworking paper*
dc.type.hasVersionVoR*
dspace.entity.typePublication
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