Multiple Large Shareholders and Owner-Manager Compensation: Evidence from French Listed firms

Sarra Amdouni and Sabri Boubaker

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Abstract: The objective of this study is to examine the relation between complex ownership structures and managerial compensation. More specifically, we examine the impact of the owner-manager's excess control and the presence of multiple large shareholders (MLS) on the owner-manager's compensation. Using a sample of French publicly listed firms, the results reveal several important points. First, the owner-manager's compensation increases with the owner-manager's excess control. This finding indicates that managers use their power to increase their pay, hence expropriating minority shareholders. Second, the presence of MLS decreases managerial opportunism and prevents owner-managers from diverting corporate resources for their own benefit. Hence, MLS play an important monitoring role.

Date: 2015
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Published in Journal of Applied Business Research, 2015, 31 (3), pp.1119-1130

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-01158102

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