search query: @indexterm MANAGEMENT PAY / total: 16
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| Author: | Wade, J. B. Porac, J. F. Pollock, T. G. |
| Title: | Worth, words, and the justification of executive pay |
| Journal: | Journal of Organizational Behavior
1997 : NOV, Vol. 18:6, p. 641-664 |
| Index terms: | MANAGEMENT PAY COMPENSATION USA CHIEF EXECUTIVE OFFICERS |
| Language: | eng |
| Abstract: | This study examines how compensation committees of a sample of U.S. corporations from the S & P justify their compensation practices to shareholders. Drawing from research on organizational legitimacy as a theoretical base, we examine the effects of ownership structure, CEO pay, and organizational performance on the frequencies of three types of compensation justifications: external validations, shareholder alignment statements, and discussions of company performance. We find that when companies have more concentrated and active outside owners, they are much more likely to justify their compensation-setting process. They are also more likely to discuss the alignment of managerial and shareholder intrests, and to downplay a company's accounting returns. |
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