The influence of executive compensation on the dispersion of security analyst forecasts

This study examines the association between executive compensation and security analyst forecast dispersion in an agency setting. It is hypothesized that firms that compensate their managers with long-term performance plans and high percentages of managerial stock will be less likely to engage in manipulation of financial statements and their financial performance will be easier to predict, thus resulting in less disperse forecasts. The results provide evidence that firms that compensate their managers with long-term performance plans and higher levels of the company stock have less dispersion associated with their security analyst forecasts and greater dispersion of their long-term growth in earnings.     

高管薪酬管制、审计意见与审计师选择

本文从高管薪酬管制政策对审计意见的影响入手,系统检验了薪酬管制政策的有效性。研究发现国有企业在实施高管薪酬管制政策的同时,经理人可能通过降低会计信息质量规避社会监督,从而遭受了更多的"非标"审计意见,增大了企业的代理成本。进一步研究发现,国企经理人会通过选择不同质量的审计师来应对增加的代理成本。结论表明,薪酬管制政策只能在短期内和表面上缓解国企过高薪酬的代理问题,需要在实施过程中出台相应的配套措施予以辅助。     

Lost in translation: exploring the link between HRM and performance in healthcare

Using data collected in 2004 from 132 Victorian (Australia) public healthcare providers, comprising metropolitan and regional hospital networks, rural hospitals and community health centres, we investigated the perceptions of HRM from the experiences of chief executive officers, HR directors and other senior managers. We found some evidence that managers in healthcare organisations reported different perceptions of strategic HRM and a limited focus on collection and linking of HR performance data with organisational performance management processes. Using multiple moderator regression and multivariate analysis of variance, significant differences were found in perceptions of strategic HRM and HR priorities between chief executive officers, HR directors and other senior managers in the large organisations. This suggested that the strategic human management paradigm is ‘lost in translation’, particularly in large organisations, and consequently opportunities to understand and develop the link between people management practices and improved organisational outcomes may be missed. There is some support for the relationship between strategic HRM and improved organisational outcomes. Implications of these findings are drawn for managerial practice.     

Long Term Incentive Plans,Executive Pay and UK Company Performance*

ABSTRACT In agency theory, the remuneration packages of executive directors in large companies are seen as an attempt to give them a pattern of rewards that aligns their interests more closely with shareholders as a whole. The sensitivity of total executive rewards to share price performance has become the conventional yardstick for judgements concerning whether reward packages do indeed serve shareholders’ interests or executives themselves. Long‐term incentive plans (LTIPs) introduced in the UK from 1995 have imposed new, firm‐specific performance conditions on senior managers. While LTIPs are designed to increase performance‐pay sensitivity, however, they also give executives new opportunities to manipulate the terms of LTIPs in their own favour, at the expense of shareholders and stakeholders in general. This paper presents the first estimates of UK total executive rewards that include detailed LTIP valuations. It finds that, while increasing average total rewards, the presence of LTIPs is actually associated with reductions in the sensitivity of executives’ total rewards to shareholder return. This raises doubts concerning both the effectiveness of the LTIP instrument and the validity of an agency perspective in this context.     

How Does Executive Strategic Human Resource Management Link to Organizational Ambidexterity? An Empirical Examination of Manufacturing Firms in China

Despite a plethora of studies that demonstrate the positive impact of strategic human resource management on firm performance, existing knowledge of the processes through which such gains can be achieved remains limited. This study aims to extend our knowledge by investigating the mechanism through which a teamwork‐oriented executive strategic human resource management system impacts organizational ambidexterity. Specifically, by integrating the resource‐based view and information‐processing theory, we examine the mediating role of top management team effectiveness and the moderating role of knowledge–sharing intensity from middle managers to top management teams. Drawing on a multiple‐source and multiple‐respondent survey from 144 manufacturing firms in China, we show that top management team effectiveness partially mediates the effect of the executive strategic human resource management system on organizational ambidexterity. Moreover, knowledge‐sharing intensity from middle managers to top management teams strengthens the effect of the executive strategic human resource management system on organizational ambidexterity. © 2016 Wiley Periodicals, Inc.     

Attitudes towards different sources of executive appraisal: a comparison of Hong Kong Chinese and American managers in Hong Kong

This study examines the attitudes of three groups of managers in Hong Kong, namely, Hong Kong Chinese managers in local Chinese firms (HK/HK), Hong Kong Chinese managers in US firms (HK/US) and American managers in US firms (US/US), towards supervisory, peer, subordinate and multi-source appraisal of executive performance. The more recent perspective of crossvergence, within the convergence-divergence debate, provides the theoretical foundation for formulating the hypotheses. The findings indicate support for this new perspective of crossvergence. There is also evidence of the coexistence of all the three perspectives of convergence, divergence and crossvergence. The study found that the practice of supervisory appraisal is supported more by HK/US and US/US managers than by HK/HK managers. Furthermore, both HK/US and US/US managers are more supportive of subordinate evaluation than peer evaluation. Overall, the findings indicate that the traditional Chinese values may be more congruent with the notion of supervisory appraisal than with peer and subordinate evaluation. The study thus points out the importance of the compatibility of norms and beliefs regarding a management practice such as performance appraisal with the local national cultures in determining the acceptance and hence the transferability of that practice across countries.     

Does CEO compensation matter in boosting firm performance? Evidence from listed French firms

The paper investigates the impact of chief executive officer (CEO) compensation on firm performance from a sample of 155 listed French companies on SBF 120, over 2009–2018. Findings suggest that an increase in CEO compensation seems to improve the accounting‐based firm performance, nevertheless it hurts the firm stock market value. More pronounced results are reported when we control for sector compensation interactions. We argue that attractive compensation may improve the executive services in achieving shareholders' objectives, but investors seem to not appreciate a CEO compensation increase. Based on the agency theory, it might be argued that investors fear possible executive opportunistic behavior encouraging them to enjoy overcompensation .     

Executive Turnover and Outside Directors on Two‐Tiered Boards

This paper examines the determinants of executive turnover on two‐tiered boards, emphasizing the monitoring role of supervisory board members with simultaneous outside directorships. Based on a unique sample of executives from large German firms, we find that outside supervisory board members generally increase executive turnover at the firms they monitor. This influence is especially pronounced when outside supervisory board members are simultaneously active as managers themselves and capital control is rather weak. These results suggest that external managers on supervisory boards enhance the monitoring intensity and substitute for weak capital control in the absence of large shareholders. Copyright © 2013 John Wiley & Sons, Ltd.     

The performance effects of coaching: a multilevel analysis using hierarchical linear modeling

Drawing on the conceptual foundations of feedback and behavior modeling we investigate the effects of managers' coaching intensity on the performance of those they supervise, at multiple levels of an organizational hierarchy. Data from 328 sales associates reporting to 114 middle managers, and 93 middle managers reporting to 32 executive managers are used to test the research hypotheses. Using hierarchical linear modeling we find that managers' coaching intensity influences the performance of their subordinates after controlling for job satisfaction, and this effect weakens at greater hierarchical levels. Surprisingly, we do not observe any cross-level moderating effects of coaching intensity on the satisfaction–performance relationship. We discuss the implications of our findings for future research and practice.     

Executive compensation and firm risk after successful mergers and acquisitions in Africa

This paper examines the impact of various executive compensation types on the postmerger risk taking by firm's executives. We find that executive pay influences firm risk differently depending on compensation type and risk measure. Specifically, we find that rewarding executives with cash compensation reduces the total postmerger risk of acquirers. However, managers are motivated to increase systematic risk when they are rewarded with stock‐based incentives. Besides, based on the argument that managerial compensation portfolio might impact systematic and unsystematic risks differently, our findings show no evidence of the impact of executive pay on unsystematic risk.     

Understanding expatriate manager performance: Effects of governance environments on work relationships in relation-based economies

Evidence shows that the majority of Western expatriate managers fail in their job assignments in developing countries. To go beyond attributions of expatriate failure to “cultural differences” this article responds to calls for a theoretical basis for understanding expatriate performance by using a recently developed framework of rule-based and relation-based governance environments to examine how the macro-environment of a country's governance system affects the creation of effective working relationships between executive level expatriate managers and Host Country Nationals (HCNs) on the executive's management team. Based on cross-cultural psychological contract research [Rousseau, D.M., Schalk, R. (2000). Psychological contracts in employment: Cross-national perspectives. Thousand Oaks, CA: Sage.] and the premise that expatriate performance is largely a function of the ability to manage discrepancies between the rule-based expectations of the Western MNC culture and the relation-based expectations of local employees, we develop research propositions to promote future HR research designed to examine the effect of the governance environment on the working relationships between American managers and Chinese HCNs. Implications for future HR efforts to improve the performance of expatriate managers in relation-based societies are also discussed.     

Competition,Outside Directors and Executive Turnover: Implications for Corporate Governance in the EU

This study examines the relevance of non‐executive outside directors with multiple directorships for corporate governance building on a large panel of European listed firms in the period 2003 to 2011. Focusing on executive turnover as an indicator for effective monitoring, the findings reveal that multiple directorships and product market competition are substitutes. Outsiders increase executive turnover in underperforming firms exclusively if competition in the industry is weak. In environments with effective competition, outsiders do not significantly influence the decision to replace underperforming managers. In fiercely competitive industries, the market pressure seems to effectively limit managerial discretion for opportunistic behavior. Copyright © 2016 John Wiley & Sons, Ltd.     

央企管理者来源对企业绩效的影响效果研究

本文将央企集团的高管作为研究对象,实证检验央企高管来源对集团绩效的影响,拟为央企集团经理人选聘的作用机制提供经验证据。研究发现:总经理岗位轮换与集团绩效的关系因继任情景不同,产生不同的结果。一方面,来自内部晋升的董事长会过度干预执行层的工作而导致企业绩效下降,这种情况在总经理岗位轮换的时候更为严重;另一方面,高管团队的稳定性对岗位轮换的总经理产生重要影响。因此,实施董事长轮岗制度,同时保证经理层的稳定性更有利于企业的发展。本文研究有助于深化认识央企高管晋升机制、高管变更的经济后果,并为国有企业高管聘任机制改革提供经验启示。     

Monitoring and governance of private banks

In this paper I examine regulation and corporate governance mechanisms at a sample of non-publicly traded state member banks in 2006. Using a simultaneous regression approach, results show that insider representation on the board has a positive influence on both director and executive compensation in commercial banks. Regulatory ratings, however, are only related to bank performance—not to board structure or compensation schemes. This may be attributed to less information asymmetry between managers and owners at private banks. Also, directors are rewarded for strong CAMELS ratings. The governance structure of private banks is not affected by regulatory ratings; however, the percent of insiders on the board influences actions of the board to a large extent.     

Human resource involvement,job-related factors,and their relation with firm performance: experiences from Greece

A great deal of debate exists regarding the relationship between human resource (HR) practices and firm performance. The purpose of this paper is to examine the relationship between HR involvement in firm's strategic planning, job-related constructs (job characteristics, workplace characteristics, and satisfaction), and their impact on firm performance. A new research model is proposed exploring the above-mentioned relationships. The validity of this model is tested using data from 106 chief executive officers (CEOs), top managers, and managing directors of Greek small medium enterprises (SMEs)), using the structural equation modeling approach. The results indicate that job characteristics and workplace characteristics directly affect satisfaction and firm performance, while HR involvement has a direct impact on job characteristics and workplace characteristics and an indirect effect on satisfaction and firm performance. It is suggested that managers should emphasize on the HR involvement in the process of strategic planning which actually affects the job-related constructs, in order to improve employees' satisfaction and achieve higher firm performance levels.     

Headquarters−Subsidiary Interdependencies and the Design of Performance Evaluation and Reward Systems in Multinational Enterprises

This study investigates the impact of headquarters–subsidiary interdependencies on performance evaluation and reward systems in multinational enterprises. Headquarters–subsidiary interdependencies refer to the extent to which headquarters and subsidiaries depend on each other to accomplish their tasks. When headquarters–subsidiary interdependencies are present, it becomes more difficult to reward the performance of subsidiary managers because these interdependencies induce noise on subsidiary-level accounting performance measures, while at the same time high levels of goal alignment between headquarters and subsidiary managers are required. Based on survey data from 82 foreign subsidiaries operating in Belgium with headquarters in 14 different countries, our partial least squares path modelling results show that as headquarters–subsidiary interdependencies increase, headquarters use more participative performance evaluation and consider more the effects of uncontrollable factors on subsidiaries' performance when rewarding subsidiary managers. More importantly, while prior research suggests that interdependencies induce noise on unit-level accounting performance measures, our results indicate that participative performance evaluation may mitigate the noise so that headquarters still rely on subsidiary formula-based compensation using accounting measures to reward subsidiary managers.     

Experienced and Novice Investors: Does Environmental Information Influence Investment Allocation Decisions?

Economic Value Added (EVA) is a performance measure that is being used by an increasing number of companies, but academic research on EVA is limited. In addition, all prior empirical academic studies on EVA have used the firm as the unit of analysis. In this study, we examine the effect of EVA on the performance of individual managers. Specifically, we examine whether managers on EVA-based bonus plans outperform managers on traditional accounting-based bonus plans. We are able to test this because we have access to an EVA-focused company that has managers on both EVA and traditional bonus plans. Our results suggest that managers on EVA bonus plans who understand the EVA concept perform better than managers on traditional bonus plans. However, we find some evidence that the increase in performance results from increased consistency or congruence in the manager's evaluation–reward process rather than from superiority of EVA as a performance measure. Also, we find that the effect of EVA bonuses and EVA understanding differs depending on the area of the firm in which the manager is employed. This suggests that EVA may not be a universally appropriate base for reward systems. *Mohan Lal passed away 24 July 2002. This paper is dedicated to him.     

Shatter the glass ceiling: Women may make better managers

There is considerable evidence that women encounter a glass ceiling or barrier to advancement into the executive ranks of organizations. Although many expected this barrier to be obliterated with the large influx of women entering the work force over the last two decades, little change has actually occurred in the most senior ranks. In most sectors, women still comprise less than 5 percent of board directorships and corporate officerships. This article focuses on emerging evidence which indicates that the trend in U.S. corporations toward high-involvement work teams, consensus decision making, and empowerment may actually benefit the leadership styles that women already exhibit. Preliminary evidence is also provided which indicates that female managers are seen as more transformational than their male counterparts—a leadership style that has been shown to have a strong positive impact on individual, group, and organizational performance.     

How CEO narcissism affects earnings management behaviors

This study examined whether chief executive officers’ (CEOs) with narcissistic tendencies are more likely to execute earnings management behavior because of pressure to fulfill earnings thresholds. The results revealed that a CEO who exhibits high narcissism is more likely to be involved in earnings management to compensate for her/his performance. Our findings suggest that CEO narcissism directly influences financial decisions. Considering the earnings thresholds, firms with a more narcissistic CEO experience a regulatory effect on real earnings management behavior. Studies have indicated that CEOs manipulate earnings to satisfy three primary earnings thresholds: prior year’s reported earnings, zero earnings, and analysts’ forecasts. Our empirical results provide further evidence that CEOs engage in earnings management to fulfill positive earnings thresholds and analysts’ forecasts. We infer that CEOs use the abnormal production cost method as an underlying mechanism to increase reported earnings. Our findings help clarify the relationship between CEO personality traits and earnings manipulation to assist investors with decision-making.     

上市公司高管股权激励与经营绩效研究综述

上市公司高管人员具有稀缺性、独特性和难以模仿性，是形成企业核心价值的根本源泉，因此对他们激励的重要性显而易见。文中通过对现有的国内外文献进行回顾，基于“利益汇聚假说”、“管理者防御假说”和“区间效应假说”三个假说分别分析了股权激励与公司绩效之间的相互关系，指出国内外学者研究结论不同所产生的原因。