 Top Executive Pay in the United Kingdom: A Corporate Governance DilemmaPhillip McKnight and Cyril Tomkins International Journal of the Economics of Business, 1999, vol. 6, issue 2, 223-243 Abstract: This study represents a first attempt in the UK literature to split total pay into salary, annual bonus and share options for the purpose of empirically verifying how each is related to executive performance. As predicted from earlier studies on total pay, salaries were found primarily determined by firm size. Contarary to prior research, however, our findings suggest a pronounced link does exist between performance and pay over both the short- and long-term. This is manifested particularly by the magnitude of the coefficient estimates found between changes in shareholders return and changes in executive share options. This finding strongly suggests that the leverage executives achieve, on average, in their rewards as share prices increase may well be substantial; a finding that has not been captured in previous research on executive remuneration and which is of considerable relevance to the current corporate governance debates. Keywords: Executive Pay; Share Options; Bonus; Salary; Black-scholes; Performance (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:ijecbs:v:6:y:1999:i:2:p:223-243 Ordering information: This journal article can be ordered from Access Statistics for this article International Journal of the Economics of Business is currently edited by Eleanor Morgan More articles in International Journal of the Economics of Business from Taylor & Francis Journals |
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