IDEAS home Printed from https://ideas.repec.org/p/lec/leecon/03-13.html
   My bibliography  Save this paper

Executive Remuneration And Firm Performance: Evidence From A Panel Of Mutual Organisations

Author

Listed:
  • Kevin Amess
  • Leigh Drake

Abstract

The empirical relationship between the remuneration of: the highest paid director (HPD), mean Board remuneration (Director), and the Chairperson of the Board (Chair) and firm- level performance is examined on a panel of mutual building societies over the 1991 to 1996 period. Two measures of performance are employed: profitability and the change in total factor productivity (TFP). A strong positive relationship between profitability and pay is found for the HPD but not for the Director or Chair. The relationship between pay and TFP change is generally weak for all three measures of executive remuneration. A strong relationship between size and the executive remuneration measures is found, particularly for the Director. Although there is evidence of pay being used as a governance device, the pay-size relationship is consistent with managerial theories of the firm. Surprisingly, our results are similar to those reported for joint stock firms.

Suggested Citation

  • Kevin Amess & Leigh Drake, 2003. "Executive Remuneration And Firm Performance: Evidence From A Panel Of Mutual Organisations," Discussion Papers in Economics 03/13, Division of Economics, School of Business, University of Leicester.
    • Handle: RePEc:lec:leecon:03/13
    as

    Download full text from publisher

    File URL: https://www.le.ac.uk/economics/research/RePEc/lec/leecon/dp03-13.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Diewert, Erwin, 2007. "Index Numbers," Economics working papers diewert-07-01-03-08-17-23, Vancouver School of Economics, revised 31 Jan 2007.
    2. Caves, Douglas W & Christensen, Laurits R & Diewert, W Erwin, 1982. "The Economic Theory of Index Numbers and the Measurement of Input, Output, and Productivity," Econometrica, Econometric Society, vol. 50(6), pages 1393-1414, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Hani El-Chaarani, 2017. "The Mutual Impacts of Corporate Governance Dimensions and Legal Protection Systems on the Performance of European Banks: A Post-Crisis Study," European Research Studies Journal, European Research Studies Journal, vol. 0(2A), pages 538-567.
    2. Sailesh Tanna & Fotios Pasiouras & Matthias Nnadi, 2011. "The Effect of Board Size and Composition on the Efficiency of UK Banks," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 18(3), pages 441-462, November.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gannon, Brenda, 2006. "Total Factor Productivity Growth in Hospitals in Ireland 1995-1998: A Non-Parametric Approach," Papers HRBWP21, Economic and Social Research Institute (ESRI).
    2. Paolo Buccirossi & Lorenzo Ciari & Tomaso Duso & Giancarlo Spagnolo & Cristiana Vitale, 2013. "Competition Policy and Productivity Growth: An Empirical Assessment," The Review of Economics and Statistics, MIT Press, vol. 95(4), pages 1324-1336, October.
    3. Luisa Affuso & Alvaro Angeriz & Michael Pollitt, 2009. "The Impact of Privatisation on the Efficiency of Train Operation in Britain," Working Papers 28, Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research.
    4. Noel Uri, 2002. "Assessing the Effect of Incentive Regulation on Productive Efficiency in Telecommunications in the United States," European Journal of Law and Economics, Springer, vol. 13(2), pages 113-127, March.
    5. Hutchinson, Sharon D. & Langham, Max R., 1999. "Productivity Growth In The Caribbean: A Measure Of Key Components," 1999 Annual meeting, August 8-11, Nashville, TN 21532, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    6. Timo Kuosmanen & Timo Sipiläinen, 2004. "On the Anatomy of Productivity Growth: A Decomposition of the Fisher Ideal TFP Index," Econometrics 0410010, University Library of Munich, Germany.
    7. Robert C. Feenstra & Marshall B. Reinsdorf, 2007. "Should Exact Index Numbers Have Standard Errors? Theory and Application to Asian Growth," NBER Chapters, in: Hard-to-Measure Goods and Services: Essays in Honor of Zvi Griliches, pages 483-513, National Bureau of Economic Research, Inc.
    8. Jose Zofio, 2007. "Malmquist productivity index decompositions: a unifying framework," Applied Economics, Taylor & Francis Journals, vol. 39(18), pages 2371-2387.
    9. Agha Ali & Dieter Gstach, 2000. "The Impact of Deregulation during 1990–1997 on Banking in Austria," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 27(3), pages 265-281, September.
    10. Luis R Murillo-Zamorano, "undated". "Total Factor Productivity Growth, Technical Efficiency Change and Energy Input. An International Frontier Analysis," Discussion Papers 03/09, Department of Economics, University of York.
    11. Elias Kourliouros & George Korres & Emmanuel Marmaras & George Tsobanoglou, 2006. "Economic Geography and Regional Growth: An Empirical Evidence From Greece," ERSA conference papers ersa06p30, European Regional Science Association.
    12. Chemak, Fraj, 2010. "Nonparametric approach for measuring the productivity change and assessing the water use efficiency in the irrigated areas of Tunisia," 2010 AAAE Third Conference/AEASA 48th Conference, September 19-23, 2010, Cape Town, South Africa 97046, African Association of Agricultural Economists (AAAE).
    13. Noel Uri, 2001. "Productivity Change, Technical Progress, and Efficiency Improvement in Telecommunications," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 18(3), pages 283-300, May.
    14. Ludena, Carlos E. & Hertel, Thomas W. & Preckel, Paul V. & Foster, Kenneth A. & Nin Pratt, Alejandro, 2005. "Disaggregate Productivity Growth in Livestock Production: A Directional Malmquist Index Approach," 2005 Annual meeting, July 24-27, Providence, RI 19395, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    15. Shaik, Saleem & Perrin, Richard K., 2001. "Agricultural Productivity and Environmental Impacts: The Role of Non-parametric Analysis," 2001 Annual meeting, August 5-8, Chicago, IL 20565, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    16. Galdeano-Gomez, Emilio & Cespedes-Lorente, Jose & Rodriguez, Manuel Rodriguez, 2005. "Productivity and Quality-Environmental Changes in Marketing Co-operatives: An Analysis on the Horticultural Sector," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24698, European Association of Agricultural Economists.
    17. Mugera, Amin W. & Langemeier, Michael R., 2008. "Labor Productivity Growth And Convergence In The Kansas Farm Sector: A Tripartite Decomposition Using The Dea Approach," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6069, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    18. Knopke, Philip, 1988. "Measuring Productivity Change Under Different Levels Of Assistance: The Australian Dairy Industry," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 32(2-3), pages 1-16, August.
    19. R. Luce & M. Raith & E. Rasmusen & S. Grosskopf & K. Velupillai & W. Pauwels & E. Furubotn & P. Schmitz & S. Napel, 2000. "Book reviews," Journal of Economics, Springer, vol. 71(3), pages 316-342, October.
    20. W. Erwin Diewert, 1995. "Price and Volume Measures in the System of National Accounts," NBER Working Papers 5103, National Bureau of Economic Research, Inc.

    More about this item

    Keywords

    Mutuals; executive remuneration; performance;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    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:lec:leecon:03/13. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Abbie Sleath (email available below). General contact details of provider: https://edirc.repec.org/data/deleiuk.html .

    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.