Does digital transformation affect enterprise executives' remuneration governance?

Xing Fang and Yiyao Sun

Finance Research Letters, 2025, vol. 77, issue C

Abstract: This paper examines the governance effects of executive remuneration resulting from enterprise digital transformation. Specifically, it explores the causal relationship between digital transformation and executive overcompensation using a two-way fixed-effects model spanning 2013 to 2022. The findings confirm that digital transformation can effectively mitigate executive overcompensation, and these governance effects are achieved through improved information disclosure quality, enhanced public oversight, and strengthened internal control mechanisms. This paper contributes to the literature on the consequences of corporate digital transformation and provides new guidance for management on regulating executive compensation.

Keywords: Digital transformation; Executive overpay; Remuneration governance (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:77:y:2025:i:c:s1544612325003368

DOI: 10.1016/j.frl.2025.107072

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