Corporate governance, executive pay and firm performance: evidence from Bangladesh

Rashid, Afzalur (2013) Corporate governance, executive pay and firm performance: evidence from Bangladesh. International Journal of Management, 30 (2). pp. 556-575. ISSN 0813-0183

Abstract

This study examines the relationship between executive pay and firm performance in
Bangladesh. While doing so it examines the ownership structure and board practices
on executive pay and pay-performance sensitivity. It is found that there is no significant
relationship between ownership structure and executive pay. There is a significant positive
relationship between board composition and executive pay; there is a significant negative
relationship between board size and executive pay and CEO duality and executive pay.
However, there is a positive relationship between executive pay and firm performance.
These findings imply that the executives who have significant ownership stakes in the
firm are not necessarily extracting rent in the form of executive pay even though they
have a consolidation of powers (CEO duality). Insider representation in the board and
management along with the consolidation of powers may have reduced the need for
performance related pay and their monitoring skill may have allowed enhancing firm
economic performance.


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Item Type: Article (Commonwealth Reporting Category C)
Refereed: Yes
Item Status: Live Archive
Additional Information: Copyright is the property of International Journal of Management and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use.
Faculty / Department / School: Historic - Faculty of Business and Law - School of Accounting, Economics and Finance
Date Deposited: 20 Aug 2013 01:45
Last Modified: 15 Jul 2014 00:14
Uncontrolled Keywords: Agency Theory, Bangladesh, Compensation, Corporate Governance, Insider Ownership, Rent Extraction, Stewardship Theory
Fields of Research : 15 Commerce, Management, Tourism and Services > 1503 Business and Management > 150303 Corporate Governance and Stakeholder Engagement
Socio-Economic Objective: E Expanding Knowledge > 97 Expanding Knowledge > 970115 Expanding Knowledge in Commerce, Management, Tourism and Services
URI: http://eprints.usq.edu.au/id/eprint/23897

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