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Ownership, Board Compensation and Company Performance in Sub-Saharan African Countries

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  • Gibson Hosea Munisi
  • Roy Mersland

Abstract

In countries with weak institutions, board governance becomes more important. This study uses a unique dataset from listed sub-Saharan African companies to examine the relationship between ownership composition and board compensation. It further analyses the association between board compensation and company performance. The findings indicate that board ownership and chief executive officer ownership are positively associated, whereas state ownership and concentrated ownership are negatively associated with board compensation. There is no evidence of a significant association between chairperson ownership or foreign ownership and board compensation. Finally, there is a negative but not significant relationship between board compensation and company performance. JEL Classification: G32, G34

Suggested Citation

  • Gibson Hosea Munisi & Roy Mersland, 2016. "Ownership, Board Compensation and Company Performance in Sub-Saharan African Countries," Journal of Emerging Market Finance, Institute for Financial Management and Research, vol. 15(2), pages 191-224, August.
    • Handle: RePEc:sae:emffin:v:15:y:2016:i:2:p:191-224
    DOI: 10.1177/0972652716645893
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    Cited by:

    1. Arindam Banik & Chanchal Chatterjee, 2021. "Ownership Pattern and Governance–Performance Relation: Evidence from an Emerging Economy," Global Business Review, International Management Institute, vol. 22(2), pages 422-441, April.
    2. Chen, Zonghao & Keefe, Michael O’Connor, 2018. "Board of director compensation in China: To pay or not to pay? How much to pay?," Emerging Markets Review, Elsevier, vol. 37(C), pages 66-82.
    3. Gonzalo Molina-Sieiro & Katia M. Galdino & R. Michael Holmes, 2023. "Ownership types, institutions, and the internationalization of emerging economy new ventures: evidence from Africa," Small Business Economics, Springer, vol. 60(3), pages 1121-1145, March.

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    More about this item

    Keywords

    Board of directors; ownership structure; board compensation; company performance; sub-Saharan Africa; weak institutions;
    All these keywords.

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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