Board of Directors’ Remuneration, Employee Costs, and Layoffs: Evidence from Spain

Mariano González-Sánchez, Eva M. Ibáñez Jiménez and Ana Isabel Segovia San Juan
Additional contact information
Mariano González-Sánchez: Department of Business and Accounting, Faculty of Economics and Business Administration, National Distance Education University (UNED), Paseo Senda del Rey, 11, 28040 Madrid, Spain
Eva M. Ibáñez Jiménez: Department of Business and Accounting, Faculty of Economics and Business Administration, National Distance Education University (UNED), Paseo Senda del Rey, 11, 28040 Madrid, Spain
Authors registered in the RePEc Author Service: Mariano Gonzalez Sanchez

Sustainability, 2021, vol. 13, issue 14, 1-10

Abstract: Most of the empirical studies on board remuneration have focused on finding explanatory performance measures. There are studies that analyze if the compensation contracts of directors reward managers in such a way that they strive to maximize firm performance and shareholders’ wealth; however, there are few studies on the social aspect of corporate governance, or agent–employee and principal–employee relationships. Thus, in this study, our aim is to test whether there is a causal relationship between the remuneration of the board of directors of listed companies and the personnel policies of the companies, expressed through the cost of personnel and layoffs. For that, we used a sample of Spanish listed companies, and we found that two performance measures (return on equity and earnings per share on market price) have a greater effect on the growth rate of board remuneration when layoffs occur. Additionally, we found that the sales revenue and cash flow on total assets subsequently influenced personnel management.

Keywords: firm performance; board remuneration; layoffs; personnel management (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2071-1050/13/14/7518/pdf (application/pdf)
https://www.mdpi.com/2071-1050/13/14/7518/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:13:y:2021:i:14:p:7518-:d:589100

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().