Top management ties with board members: How they affect pay–performance sensitivity and IPO performance

Salim Chahine and Marc Goergen

Journal of Corporate Finance, 2014, vol. 27, issue C, 99-115

Abstract: This paper is the first study on the effects of pay–performance sensitivity (PPS) on the performance of initial public offerings (IPOs) in the presence of social ties and family ties of the top managers with board members. We find that both social ties and family ties increase PPS. In turn, PPS improves IPO performance. More importantly, greater PPS increases the positive effect of social ties on IPO performance whereas it reduces the negative effect of family ties.

Keywords: Initial public offerings (IPOs); Family ties; Social ties; Pay–performance sensitivity; Homophily (search for similar items in EconPapers)
JEL-codes: G32 G34 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:27:y:2014:i:c:p:99-115

DOI: 10.1016/j.jcorpfin.2014.04.007

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