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Say Pays! Shareholder Voice and Firm Performance

Vicente Cuñat (), Mireia Gine and Maria Guadalupe ()

MPRA Paper from University Library of Munich, Germany

Abstract: This paper estimates the effects of Say-on-Pay (SoP); a policy that increases shareholder "voice" by providing shareholders with a regular vote on executive pay. We apply a regression discontinuity design to the votes on shareholder-sponsored SoP proposals. Adopting SoP leads to large increases in market value (4.6%) and to improvements in long-term performance: profitability and labor productivity increase, while overheads and investment fall. In contrast, we find limited effects on pay levels and structure. This suggests that SoP operates as a regular vote of confidence, increasing efficiency and market value.

Keywords: Say-on-Pay; Shareholder Voice; Executive Compensation; Firm Performance; Governance (search for similar items in EconPapers)
JEL-codes: G34 L20 M12 (search for similar items in EconPapers)
Date: 2013-07-19
New Economics Papers: this item is included in nep-eff and nep-hrm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5) Track citations by RSS feed

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https://mpra.ub.uni-muenchen.de/48489/1/MPRA_paper_48489.pdf original version (application/pdf)

Related works:
Journal Article: Say Pays! Shareholder Voice and Firm Performance (2016) Downloads
Working Paper: Say pays! Shareholder voice and firm performance (2016) Downloads
Working Paper: Say Pays! Shareholder Voice and Firm Performance (2014) Downloads
Working Paper: Say Pays! Shareholder Voice and Firm Performance (2014) Downloads
Working Paper: Say pays! Shareholder voice and firm performance (2013) Downloads
Working Paper: Say Pays! Shareholder Voice and Firm Performance (2013) Downloads
Working Paper: Say Pays! Shareholder Voice and Firm Performance (2013) Downloads
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