Incentive‐based executive compensation is regarded as a mechanism for alleviating agency problems between executives and shareholders. Seventy‐three New Zealand (NZ) listed companies are used to examine the relationship between executive incentive compensation schemes (ICS) and firm performance. The results suggest that neither compensation level nor adoption of an ICS are significantly related to returns to shareholders or ROA. However, there is a statistically significant relationship between Tobin's q and both CEO compensation and executive share ownership. Further, the evidence suggests the recent compensation disclosure requirements in NZ are not yet stringent enough to allow adequate analysis of the link between ICSs and corporate performance.
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1 January 2003
Review Article|
January 01 2003
EXECUTIVE INCENTIVE COMPENSATION SCHEMES AND THEIR IMPACT ON CORPORATE PERFORMANCE: EVIDENCE FROM NEW ZEALAND SINCE COMPENSATION DISCLOSURE REQUIREMENTS BECAME EFFECTIVE Available to Purchase
FAYEZ A. ELAYAN;
FAYEZ A. ELAYAN
Massey University, New Zealand
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JAMMY S.C. LAU;
JAMMY S.C. LAU
Massey University, New Zealand
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THOMAS O. MEYER
THOMAS O. MEYER
Massey University, New Zealand
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Publisher: Emerald Publishing
Online ISSN: 1755-6791
Print ISSN: 1086-7376
© MCB UP Limited
2003
Studies in Economics and Finance (2003) 21 (1): 54–92.
Citation
ELAYAN FA, LAU JS, MEYER TO (2003), "EXECUTIVE INCENTIVE COMPENSATION SCHEMES AND THEIR IMPACT ON CORPORATE PERFORMANCE: EVIDENCE FROM NEW ZEALAND SINCE COMPENSATION DISCLOSURE REQUIREMENTS BECAME EFFECTIVE". Studies in Economics and Finance, Vol. 21 No. 1 pp. 54–92, doi: https://doi.org/10.1108/eb028769
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