CEO Compensation Among Firms Controlled by Large Shareholders: Evidence from Emerging Markets
Francisco A. Gallego
Pontificia Universidad Catolica de Chile
Universidad Catolica de Chile
september 1, 2010
Pontificia Universidad Catolica de Chile Documento de Trabajo No. 381, 2010
Using a novel data base for three emerging markets, we find that the type of large shareholder matters for CEO compensation. In particular, we find a compensation premium of about 30 log points for professional (not controller-related) CEOs working in firms controlled by a family compared to firms controlled by other large shareholders. The premium cannot be explained away by standard firm characteristics, observable executive skills (e.g., education or tenure), or the compensation of the CEO in her former job. The premium comes mostly from family firms with absent founders and when sons are involved.
Number of Pages in PDF File: 50
Date posted: December 3, 2010
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