Case Studies of Executive Compensation in Agricultural Cooperatives

David D. Trechter, Robert King, David W. Cobia and Jason G. Hartell

Review of Agricultural Economics, 1997, vol. 19, issue 2, 492-503

Abstract: Few factors are more important for a cooperative's success than the manager. However, structuring a manager's compensation package to deal with principal-agent problems is a challenge for cooperatives. Conceptually, this problem could be addressed with ex ante incentive clauses that would signal the board's preferences to the manager. The five case studies in this paper examine compensation and evaluation methods for managers of successful local supply and marketing cooperatives. These cases suggest a reluctance to use ex ante incentives to ensure performance.

Date: 1997
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