Abstract

http://ssrn.com/abstract=1103682
 
 

References (29)



 
 

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The Incentives of Compensation Consultants and CEO Pay


Brian D. Cadman


University of Utah - David Eccles School of Business

Mary Ellen Carter


Boston College - Department of Accounting

Stephen A. Hillegeist


Arizona State University (ASU) - W. P. Carey School of Business, School of Accountancy

February 1, 2009

Journal of Accounting and Economics, Forthcoming

Abstract:     
We examine whether compensation consultants' potential cross-selling incentives explain more lucrative CEO pay packages using 755 firms from the S&P 1500 for 2006. Critics allege that these incentives lead consultants to bias their advice to secure greater revenues from their clients (Waxman, 2007). Among firms that retain consultants, we are unable to find widespread evidence of higher levels of pay or lower pay-performance sensitivities for clients of consultants with potentially greater conflicts of interest. Overall, we do not find evidence suggesting that potential conflicts of interest between the firm and its consultant are a primary driver of excessive CEO pay.

Number of Pages in PDF File: 43

Keywords: Executive Compensation, Compensation Consultants

JEL Classification: J33, G34

Accepted Paper Series


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Date posted: March 13, 2008 ; Last revised: July 8, 2009

Suggested Citation

Cadman, Brian D. and Carter, Mary Ellen and Hillegeist, Stephen A., The Incentives of Compensation Consultants and CEO Pay (February 1, 2009). Journal of Accounting and Economics, Forthcoming. Available at SSRN: http://ssrn.com/abstract=1103682

Contact Information

Brian D. Cadman (Contact Author)
University of Utah - David Eccles School of Business ( email )
1645 Campus Center Drive
Salt Lake City, UT 84112
United States
801-585-9517 (Phone)
HOME PAGE: http://www.business.utah.edu/bio/briancadman
Mary Ellen Carter
Boston College - Department of Accounting ( email )
Carroll School of Management
140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States
Stephen A. Hillegeist
Arizona State University (ASU) - W. P. Carey School of Business, School of Accountancy ( email )
Tempe, AZ 85287-3706
United States
480-965-6614 (Phone)
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