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Clawback Rule – The Ground of Managers Responsible. Model of Remuneration

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Listed:
  • Pawel Dec
  • Piotr Masiukiewicz

Abstract

The paper concerns the duties and responsibilities of managers using the principle of clawback. The authors proposed their own model of financial model of construction of remuneration for managers. There are in practice ethical problems concerning the level of requirements and qualifications versus salary and the level of legal and financial liability, especially against top-managers of the largest enterprises; often in a situation of extensive economic and social impact of their decisions. The problem of a manager’s responsibility has a dual nature. On the one hand the manager is charged with overall responsibility for all financial and PR losses of a company, on the other hand the manager takes moral, legal and financial responsibility for particular decisions. This article considers the financial responsibility area. The subprime financial crisis has sparked a discussion about the responsibility of top management in the context of disclosure of large bonuses paid to the senior managers and lack of consequences for bankruptcies. Very high salaries the executives were paid, were not sufficiently related to the system of contractual and administrative responsibility.

Suggested Citation

  • Pawel Dec & Piotr Masiukiewicz, 2018. "Clawback Rule – The Ground of Managers Responsible. Model of Remuneration," Business Management and Strategy, Macrothink Institute, vol. 9(1), pages 18-27, December.
  • Handle: RePEc:mth:bmsmti:v:9:y:2018:i:1:p:18-27
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    References listed on IDEAS

    as
    1. Pawe? Dec & Piotr Masiukiewicz, 2018. "Sharing Economy-New Phenomenon," Business and Economic Research, Macrothink Institute, vol. 8(2), pages 1-10, June.
    2. Piotr Masiukiewicz, 2015. "Models of Financial Responsibility of Management Board in Companies," Journal of Applied Management and Investments, Department of Business Administration and Corporate Security, International Humanitarian University, vol. 4(4), pages 243-251, November.
    3. Paul Gregg & Sarah Jewell & Ian Tonks, 2012. "Executive Pay and Performance: Did Bankers’ Bonuses Cause the Crisis?," International Review of Finance, International Review of Finance Ltd., vol. 12(1), pages 89-122, March.
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    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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