RT Generic
T1 Board reputation, CEO pay, camouflaged compensation
A1 Ruiz-Verdú, Pablo
A1 Singh, Ravi
AB Reputational concerns are arguably the single most powerful incentive for board directors to actin the interest of shareholders. We propose a model to investigate the impact of boards' reputationalconcerns on the level and structure of executive compensation, the use of camouaged pay, and therelation between board independence and compensation decisions. We show that, in order to beperceived as independent, boards lower managers' pay, but may also pay managers in hidden waysor structure compensation ine ciently. Interestingly, independent boards, not manager-friendlyboards, are more likely to make use of hidden compensation. We apply our model to study thecosts and bene ts of greater pay transparency and of measures, such as say-on-pay initiatives, thatincrease boards' accountability to shareholders.
PB Social Science Research Network
YR 2011
FD 2011-03-08
LK https://hdl.handle.net/10016/12720
UL https://hdl.handle.net/10016/12720
LA eng
NO Pablo Ruiz-Verd u gratefully acknowledges the  nancial support of the Spanish Ministry of Science and Innovationfor  nancial support under grant ECO2009/08278. We thank seminar participants at the Swiss Finance Institute, theUniversity of Texas at Austin, the European Financial Management Association Annual Conference (2010) and theXVIII Finance Forum for useful discussions and suggestions.
DS e-Archivo
RD 1 sept. 2024