Executive compensation in socially responsible firms

    Authors

    M. B. Frye; E. Nelling;E. Webb

    Comments

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    Abbreviated Journal Title

    Corp. Gov.

    Keywords

    corporate social responsibility; executive remuneration; stakeholders; CORPORATE GOVERNANCE; PERFORMANCE; MANAGEMENT; PAY; ATTRACTIVENESS; INCENTIVES; Business; Business, Finance; Management

    Abstract

    This study examines chief executive officer (CEO) compensation and turnover in socially responsible (SR) firms. We compare characteristics of SR firms with a matched sample of firms based on industry and size. Analysis of CEO compensation indicates that the link between CEO pay and firm performance is weaker for SR firms than for non-SR firms. CEO turnover tests indicate that SR firms are more likely to experience CEO turnover following poor performance. Stock option grants to CEOs of SR firms do not appear to result in future risk-taking behaviour, whereas such grants are significantly related to future risk at non-SR firms.

    Journal Title

    Corporate Governance-an International Review

    Volume

    14

    Issue/Number

    5

    Publication Date

    1-1-2006

    Document Type

    Article

    Language

    English

    First Page

    446

    Last Page

    455

    WOS Identifier

    WOS:000240557900008

    ISSN

    0964-8410

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