IDEAS home Printed from https://ideas.repec.org/a/ids/intjaf/v7y2017i2p163-184.html
   My bibliography  Save this article

Peer group benchmarking in CEO compensation and firm innovation: evidence from patents and citations

Author

Listed:
  • Shahbaz Sheikh

Abstract

This study provides empirical evidence on the relation between peer group benchmarking in CEO compensation and firm innovation measured by number of patents and citations. Results show that peer group benchmarking and firm innovation are positively related. However, this positive relation holds only for CEOs who receive higher than median peer group compensation. For CEOs who receive lower than median peer group compensation, benchmarking seems to have no statistically significant effect on firm innovation. The study also finds that CEO compensation benchmarked against median peer group compensation is positively related to one-year and five-year stock return volatility. Overall, results suggest that benchmarking in CEO compensation is an efficient response to competitive pressures in CEO talent market and is not driven by an intentional effort by the powerful CEOs to extract rents from their firms.

Suggested Citation

  • Shahbaz Sheikh, 2017. "Peer group benchmarking in CEO compensation and firm innovation: evidence from patents and citations," International Journal of Accounting and Finance, Inderscience Enterprises Ltd, vol. 7(2), pages 163-184.
    • Handle: RePEc:ids:intjaf:v:7:y:2017:i:2:p:163-184
    as

    Download full text from publisher

    File URL: http://www.inderscience.com/link.php?id=85504
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ids:intjaf:v:7:y:2017:i:2:p:163-184. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sarah Parker (email available below). General contact details of provider: http://www.inderscience.com/browse/index.php?journalID=231 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.