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| Author: | Gore, A. K. Matsunaga, S. Yeung, P. E. |
| Title: | The role of technical expertise in firm governance structure: evidence from chief financial officer contractual incentives |
| Journal: | Strategic Management Journal
2011 : JUL, VOL. 32:7 p. 771-786 |
| Index terms: | incentives agency theory executives executive remuneration corporate governance board of directors chief executive officers finance companies |
| Language: | eng |
| Abstract: | This article argues that the technical expertise in company governance structure reduces reliance on contractual incentives to control the potential agency problem for executives whose responsibilities require specialized knowledge. It is found that companies with financial expertise tend to use lower levels of incentive-based compensation for their chief financial officers. The results propose that financial experts provide stronger supervision and/or direction concerning company financial policies and strategies, thus allowing companies to reduce reliance on incentive compensation. |
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