Abstract

http://ssrn.com/abstract=2335584
 


 



Do Qualifications Matter? New Evidence on Outside Director Compensation


Viktar Fedaseyeu


Bocconi University - Department of Finance; Bocconi University - IGIER - Innocenzo Gasparini Institute for Economic Research

James S. Linck


Southern Methodist University

Hannes F. Wagner


Bocconi University - Department of Finance; Bocconi University - IGIER - Innocenzo Gasparini Institute for Economic Research

April 30, 2015


Abstract:     
Does compensation of outside directors reward relevant expertise? Using new compensation data covering 56,356 position-years held by 13,239 outside directors, we show that outside directors' compensation varies substantially across boards and board members, even within the same firm. Directors with better qualifications receive higher compensation, because they are allocated higher workloads and obtain more, and better paying, board seats. Results from an analysis of unexpected director departures suggest that outside directors' expertise is valued by the market. Overall, our results suggest that the market rewards outside directors who have relevant expertise.

Number of Pages in PDF File: 55

Keywords: Boards of directors, incentives, remuneration, compensation, pay, governance, corporate boards


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Date posted: October 7, 2013 ; Last revised: May 1, 2015

Suggested Citation

Fedaseyeu, Viktar and Linck, James S. and Wagner, Hannes F., Do Qualifications Matter? New Evidence on Outside Director Compensation (April 30, 2015). Available at SSRN: http://ssrn.com/abstract=2335584 or http://dx.doi.org/10.2139/ssrn.2335584

Contact Information

Viktar Fedaseyeu
Bocconi University - Department of Finance ( email )
Via Roentgen 1
Milano, MI 20136
Italy
+390258365283 (Phone)
+390258365283 (Fax)
Bocconi University - IGIER - Innocenzo Gasparini Institute for Economic Research ( email )
Via Roentgen 1
Milan, 20136
Italy
James S. Linck (Contact Author)
Southern Methodist University ( email )
Cox School of Business
Dallas, TX 75275
United States
214-768-3933 (Phone)
HOME PAGE: http://cox.smu.edu
Hannes F. Wagner
Bocconi University - Department of Finance ( email )
Via Roentgen 1
Milano, MI 20136
Italy
HOME PAGE: http://faculty.unibocconi.eu/hanneswagner
Bocconi University - IGIER - Innocenzo Gasparini Institute for Economic Research ( email )
Via Roentgen 1
Milan, 20136
Italy
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