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CEO pay, firm performance, and corporate governance in India's listed firms

Author

Listed:
  • Manju Jaiswall
  • Michael Firth

Abstract

In this study we examine the determinants of CEO compensation in large listed Indian companies. There is a positive relation between pay and a firm's performance. We find that remuneration committees are related to higher CEO compensation and there is no association between remuneration committees and pay-performance sensitivities. Thus, remuneration committees do not act in the way predicted by governance guidelines. CEOs in family firms are paid more. This suggests that CEOs use their power as a member of the controlling family to obtain higher compensation. The minority shareholders are therefore disadvantaged. CEOs in risky firms are paid less.

Suggested Citation

  • Manju Jaiswall & Michael Firth, 2009. "CEO pay, firm performance, and corporate governance in India's listed firms," International Journal of Corporate Governance, Inderscience Enterprises Ltd, vol. 1(3), pages 227-240.
    • Handle: RePEc:ids:ijcgov:v:1:y:2009:i:3:p:227-240
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    Citations

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    Cited by:

    1. Jaiswall, Sudhir Shiv Kumar & Bhattacharyya, Asish Kumar, 2016. "Corporate governance and CEO compensation in Indian firms," Journal of Contemporary Accounting and Economics, Elsevier, vol. 12(2), pages 159-175.
    2. Suveera Gill & Manika Kohli, 2018. "Perceptual Determinants of Executive Compensation: Survey-Based Evidence from India," Indian Journal of Corporate Governance, , vol. 11(2), pages 159-184, December.
    3. Faozi A. Almaqtari & Hamood Mohd. Al-Hattami & Khalid M. E. Al-Nuzaili & Mohammed A. Al-Bukhrani, 2020. "Corporate governance in India: A systematic review and synthesis for future research," Cogent Business & Management, Taylor & Francis Journals, vol. 7(1), pages 1803579-180, January.
    4. Sudhir Kumar Jaiswal & Asish Kumar Bhattacharyya, 2016. "The role of operating efficiency and asset productivity in relative performance evaluation and CEO compensation in Indian firms," DECISION: Official Journal of the Indian Institute of Management Calcutta, Springer;Indian Institute of Management Calcutta, vol. 43(3), pages 201-221, September.

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