Executive Compensation and Compensation Risk: Evidence from Technology Firms

30 Pages Posted: 17 May 2013

See all articles by Jimmy Yu

Jimmy Yu

University of Calgary - Haskayne School of Business, Students

Samir Trabelsi

Brock University - Accounting

Paul Dunn

Brock University

Zhongzhi Lawrence He

Brock University, Goodman School of Business

Date Written: May 16, 2013

Abstract

The purpose of this research is to investigate factors that contribute to technology firms paying higher compensation than non-technology firms, and why the mix of compensation at technology firms is different than the compensation packages at non-technology firms. Using a sample of 1,009 firm-year observations for the five-year period from 2001 to 2005, we find that the total compensation paid to the CEOs of technology firms is higher than the total compensation paid to the CEOs of non-technology firms, and that the value of the stock options granted to the former is greater than the value of the stock options granted to the latter. This difference can be explained by the risk premium that technology CEOs have in their compensation packages. The implications of this finding are discussed in the conclusion of the paper.

Keywords: Executive compensation, Compensation risk, technology firms

JEL Classification: J33, J44, M12, M52

Suggested Citation

Yu, Jimmy and Trabelsi, Samir and Dunn, Paul and He, Zhongzhi Lawrence, Executive Compensation and Compensation Risk: Evidence from Technology Firms (May 16, 2013). Available at SSRN: https://ssrn.com/abstract=2266168 or http://dx.doi.org/10.2139/ssrn.2266168

Jimmy Yu

University of Calgary - Haskayne School of Business, Students ( email )

Canada

Samir Trabelsi (Contact Author)

Brock University - Accounting ( email )

St. Catharines, Ontario L2S 3A1
Canada

Paul Dunn

Brock University ( email )

500 Glenridge Avenue
St. Catherines, Ontario L2S 3A1
Canada

Zhongzhi Lawrence He

Brock University, Goodman School of Business ( email )

500 Glenridge Avenue
Finance
St. Catherine's, Ontario L2S 3A1
Canada

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