Executive compensation in firms with concentrated control: The impact of dual class structure and family management

Journal of Corporate Finance

Volumn 17, Issue 5, 2011, Pages 1580-1594

  Amoako Adu, Ben ^a   Baulkaran, Vishaal ^a,b   Smith, Brian F ^a  

^a WILFRID LAURIER UNIVERSITY   (Canada)

^b UNIVERSITY OF LETHBRIDGE   (Canada)

Author keywords

Compensation; Dual class; Family executive

Indexed keywords

EID: 80053654043     PISSN: 09291199     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.jcorpfin.2011.09.003     Document Type: Article

References (40)

1. Basu S., Hwang L., Mitsudome T., Weintrop J. Corporate governance, top executive compensation and firm performance in Japan. Pacific-Basin Finance J. 2007, 15:56-79.
2. Bebchuk L., Fried J. Executive compensation as an agency problem. J. Econ. Perspect. 2003, 17:71-92.
3. Bebchuk L., Fried J., Walker D. Managerial power and rent extraction in design of executive compensation. U. Chicago Law Rev. 2002, 69:751-846.
4. Block J. Are CEOs in family firms paid like bureaucrats? Evidence from Bayesian and Frequentist Analysis. Munich University of Technology Working paper 2008, Available at SSRN: http://ssrn.com/abstract=1123965.
5. Chalmers K., Koh P., Stapledon G. The determinants of CEO compensation: rent extraction or labour demand?. Br. Account. Rev. 2006, 38:259-275.
6. Cheung Y., Stouraitis A., Wong A. Ownership concentration and executive compensation in closely held firms: evidence from Hong Kong. J. Empir. Financ. 2005, 12:511-532.
7. Claessens S., Djankov S., Lang L. The separation of ownership and control in East Asian Corporations. J. Financ. Econ. 2000, 58:81-112.
8. Cohen S., Lauterbach B. Differences in pay between owner and non-owner CEOs: evidence from Israel. J. Multinat. Financ. Manage. 2008, 18:4-15.
9. Core J., Larcker D. Performance consequences of mandatory increases in executive stock ownership. J. Financ. Econ. 2003, 64:317-340.
10. Core J., Holthausen R., Larcker D. Corporate governance, chief executive officer compensation and firm performance. J. Financ. Econ. 1999, 51:371-406.
11. Correia da Silva L., Goergen M., Renneboog L. Dividend Policy and Corporate Governance 2004, Oxford University Press Inc., New York.
12. DeAngelo H., DeAngelo L. Managerial ownership of voting rights: a study of public corporations with dual classes of common stock. J. Financ. Econ. 1985, 14:33-69.
13. DeFusco R., Johnson R., Zorn T. The effect of executive stock option plans on stockholders and bondholders. J. Finance 1990, 45:617-627.
14. Denis D.J., Denis D.K. Majority owners-managers and organizational efficiency. J. Corp. Finance. 1994, 1:91-118.
15. Dyl E. Corporate control and management compensation: evidence on the agency problem. Manage. Decis. Econ. 1988, 9:21-25.
16. Goldberg L., Idson T. Executive compensation and agency effects. Financ. Rev. 1995, 30:313-335.
17. Gomez-Mejia L., Larraza-Kintana M., Makri M. The determinations of executive compensation in family-controlled public corporations. Acad. Manage. J. 2003, 46:226-237.
18. Gomez-Mejia L., Wiseman R.M. Reframing executive compensations: an assessment and outlook. J. Manage. 1997, 23:291-374.
19. Gompers P., Ishii J., Metrick A. Extreme governance: an analysis of dual-class firms in the United States. Rev. Financ. Stud. 2010, 23:1051-1088.
20. Grabke-Rundell A., Gomez-Mejia L. Power as determinant of executive compensation. Hum. Resour. Manage. R. 2002, 12:3-23.
21. Grossman S., Hart O. One share-one vote and the market for corporate control. J. Financ. Econ. 1988, 20:175-202.
22. Haid A., Yurtoglu B. Ownership structure and executive compensation in Germany Available at SSRN:. http://ssrn.com/abstract=948926.
23. Hartzell J., Starks L. Institutional investors and executive compensation. J. Finance 2003, 58:2351-2374.
24. Heckman J. Sample selection bias as a specification error. Econometrica 1979, 47:153-161.
25. Holderness C., Sheehan D. The role of majority shareholders in publicly held corporations: an exploratory analysis. J. Financ. Econ. 1988, 20:317-346.
26. King M., Santor E. Family values: ownership structure, performance and capital structure of Canadian firms. J. Bank. Financ. 2008, 32:2423-2432.
27. La Porta R., Lopez-de-Silanes F., Shleifer A. Corporate ownership around the world. J. Finance 1999, 54:471-517.
28. Larcker D. The association between performance plan adoption and corporate capital investment. J. Account. Econ. 1983, 5:3-30.
29. Lehn K., Netter J., Poulsen A. Consolidating corporate control: dual-class recapitalization versus leveraged buyouts. J. Financ. Econ. 1990, 27:557-580.
30. Li K., Ortiz-Molina H., Zhao X. Do voting rights affect institutional investment decisions? Evidence from dual class firms. Financ. Manage. 2008, 37:713-745.
31. Lins K. Equity ownership and firm value in emerging markets. J. Financ. Quant. Analy. 2003, 38:159-184.
32. Masulis R., Wang C., Xie F. Agency problems at dual class companies. J. Finance 2009, 64:1697-1727.
33. McConaughy D. Family CEOs vs. Nonfamily CEOs in family-controlled firms: An examination of the level and sensitivity of pay to performance. Fam. Bus. Rev. 2000, 13:121-131.
34. McConaughy D., Walker M., Henderson G., Mishra C. Founding family controlled firms: efficiency and value. Rev. Financ. Econ. 1998, 7:1-19.
35. Morgan A., Poulsen A. Linking pay to performance: compensation proposals in the S&P 500. J. Financ. Econ. 2001, 62:489-523.
36. Murphy K. Executive compensation. Handbook of Labor Economics 1999, vol. 3:2485-2563. North-Holland, Amsterdam.
37. Nenova T. The value of corporate voting rights and control: a cross-country analysis. J. Financ. Econ. 2003, 68:325-357.
38. Smith B.F., Amoako-Adu B. Management succession and financial performance of family controlled firms. J. Corp. Finance. 1999, 5:341-368.
39. Tinaikar S. Voluntary disclosure and ownership structure: An analysis of dual class firms 2009, Available at SSRN. http://ssrn.com/abstract=1129240.
40. Weisbach M. Optimal executive compensation versus managerial power: a review of Lucian Bebchuk and Jesse Fried's Pay without Performance: The Unfilled Promised of Executive Compensation. J. Econ. Lit. 2007, 45:419-428.