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

Posted: 24 Aug 2006

See all articles by Charles Piot

Charles Piot

Univ. Grenoble Alpes; University of Angers - Centre de Recherches Appliquées à la Gestion (CERAG)

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

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: https://ssrn.com/abstract=926282

Charles Piot (Contact Author)

Univ. Grenoble Alpes ( email )

Grenoble Cedex 9, F-38040
France

University of Angers - Centre de Recherches Appliquées à la Gestion (CERAG)

150 rue de la Chimie, BP47
Grenoble Cedex 9, 38040
France

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