Determinants of the Existence and Managerial Independence of Remuneration and Nominating Committees in France
Charles Piot
University of Grenoble; French National Center for Scientific Research (CNRS) - Centre de Recherches Appliquées à la Gestion (CERAG)
Finance Controle Strategie, Vol. 9, No. 2, pp. 159-185, June 2006
Abstract:
This paper investigates the determinants of the existence and managerial independence of remuneration and nominating board committees in the French context. Hypotheses rely on the agency theory framework, in which managers' opportunism justifies the implementation of effective monitoring devices. The sample comprises non-financial companies of the SBF 120 index, over the 1999-2001 period. Logistic analyses suggest that the existence of remuneration committees results from monitoring needs of the shareholder-manager agency relationship, whereas this is far less the case with respect to nominating committees. Furthermore, managers' ownership does not discriminate the fact that both types of committees exclude top managers.
Keywords: Compensation/remuneration committee, nominating committee, agency theory, corporate governance
JEL Classification: G38, M12
Accepted Paper Series
Suggested Citation
Piot, Charles, Determinants of the Existence and Managerial Independence of Remuneration and Nominating Committees in France. Finance Controle Strategie, Vol. 9, No. 2, pp. 159-185, June 2006. Available at SSRN: http://ssrn.com/abstract=926282
