Abstract

http://ssrn.com/abstract=2335584
 


 



Do Qualifications Matter? New Evidence on 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

June 14, 2016


Abstract:     
Prior research suggests that the effectiveness of corporate directors depends on their qualifications. We investigate whether directors’ qualifications are reflected in their pay. We find significant variation in director compensation both across and within boards, with more than a third of the variation in director pay attributable to differences among members of the same board. On average, more qualified directors receive higher pay, while CEO-appointed (“co-opted”) directors do not. However, co-opted directors receive higher pay on boards where the CEO’s influence is high. We also provide evidence that the market values qualified directors and discounts co-opted ones.

Number of Pages in PDF File: 55

Keywords: Boards of directors, compensation, governance, incentives, outside directors


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Date posted: October 7, 2013 ; Last revised: June 17, 2016

Suggested Citation

Fedaseyeu, Viktar and Linck, James S. and Wagner, Hannes F., Do Qualifications Matter? New Evidence on Director Compensation (June 14, 2016). 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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