Executive Compensation and Corporate Performance: Evidence from an Emerging Market

Abstract

Executive compensation practices suppose to influence the motivational level of the employees and hence affect the organizational performance. The study examines to explore how the executive compensation practices by the Bangladeshi companies affect the corporate performance. The study is conducted on 56 employees of different private organizations of Bangladesh. A structured questionnaire is used to conduct the survey. It is found that out of four different executive compensation plan only special amenities i.e. signing bonuses, extra vacation time, special work space, company sponsored club memberships influences the overall organization performance. This study result can help human resource managers of Bangladesh in designing the executive compensation system of their organization.

Keywords: executive compensation, corporate performance, employee stock ownership plan, special amenities

JEL Classification: M4, L21, M41