Higher Levels Of Compensation Research Articles

The determinants of CEO compensation: new insights from United States

PurposeThe purpose of this paper is to examine the determinants of CEO compensation for sample of the US firms. It emphasizes the presence of executive compensation persistence and the importance of CEO power besides performance while setting CEO pay.Design/methodology/approachThe empirical analysis is conducted on a large sample of US firms during the period 2006–2016. It is based on the generalized method of moments (GMM) models to assess the impact of numerous factors on CEO compensation.FindingsThe main findings reveal that firm performance proxied by accounting-based proxies, as well as market-based proxies, plays a significant role in explaining variations in levels of executive compensation. Moreover, there is a significant persistence in executive compensation among the US sample firms. The authors also document that poor governance conditions (managerial power hypothesis) lead to high compensation levels offered to CEO.Research limitations/implicationsAt the end, without a doubt, the analysis has some limitations that prompt the authors to consider future research directions. One future research avenue that can help better explain the effect of firm performance on the CEO compensation is to study this issue using an international sample to determine whether country-level characteristics (e.g. creditor rights, shareholder rights and the enforcement climate) can influence this relationship. Furthermore, it can be worthwhile to deepen the analysis of CEO power and its impact on CEO compensation. It will be interesting to emphasize how the CEO power interacts with the other governance characteristics and some CEO attributes as CEO gender.Practical implicationsThe paper's findings have implications for practitioners, policymakers and regulatory authorities. First, the findings inform regulators that performance is not the only determinant of CEO pay level. This may warrant increased firm disclosure of the details of the pay structure. Second, the study offers insights to policymakers and members of boards of directors interested in enhancing the design of executive compensation and internal corporate governance, to better align managerial incentives to shareholder interests. Firms should strengthen the board independence and properly constitute the board committees (compensation, risk, nomination…).Originality/valueThis paper presents a comprehensive overview of the CEO compensation determinants. It supplements the classic pay-for-performance sensitivity predictions with insights gained from the dynamics of wage setting theory and managerial power theory. The authors develop a composite index to measure the CEO power in order to test the impact of CEO attributes on CEO pay. Additionally, it verifies whether the determinants of CEO pay depend on firm age and size.

Excessive CEO Compensation and Effort Contributions in the Non-Profit Sector

This study examines whether high executive compensation has adverse effects on volunteers' willingness to make labor contributions to nonprofit organizations. Using compensation information in IRS Form 990, we find that high CEO compensation negatively influences the number of future volunteers working for the nonprofit organization if executive compensation is considered to be excessively high, or if there is media attention regarding the CEO's compensation. These effects are most pronounced in smaller and more charitable organizations. Hence, our study presents previously undocumented implications of high executive compensation levels in the nonprofit sector.

DETERMINANTS OF ORGANIZATIONAL COMMITMENT AND ITS IMPLICATION ON TURNOVER INTENTION AT THE FOODHALL IN DKI JAKARTA PROVINCE

The purpose of this study was to determine the effect of organizational culture, career development, compensation and organizational commitment partially or simultaneously on employee turnover intention. The population in this study amounted to 1,982 employees at twenty-five outlets of The Foodhall in DKI Jakarta Province, with a total sample of 355 respondents. The research method used in this research is descriptive and explanatory survey methods. The sampling method is probability sampling with proportional random sampling technique, and the data analysis method used is SEM (Structural Equation Modeling) with data analysis tools Lisrel 8.80. Based on the research results obtained the following findings: organizational culture, career development, and compensation partially and simultaneously have a significant effect on organizational commitment with a contribution of 58%. Partially career development which is reflected in career doubt has a positive and dominant effect on organizational commitment. Organizational culture, career development, compensation and organizational commitment either partially or simultaneously have a significant effect on employee turnover intention with a contribution of 81%. Partially, organizational commitment has the most dominant influence on employee turnover intentions. The results also show that organizational commitment is a fully mediating variable on the influence of organizational culture, career development, and compensation on employee turnover intention. The managerial implication of this research is that the turnover intention of The Foodhall's employees in Jakarta, which is reflected in the dimension of stopping work, will decrease if The Foodhall in Jakarta is able to increase organizational commitment which is reflected in sustainable commitment, while organizational commitment will increase if The Foodhalls in Jakarta can improve career development. employees who are reflected in career doubts which are supported by an increase in organizational culture which is reflected in the dimensions of results orientation and also supported by an increase in compensation given to employees which is reflected in the high level of indirect compensation.

Role of monitoring in environmental regulation: An empirical analysis of grazing restrictions in pastoral China

To alleviate grassland degradation, top-down command-and-control environmental regulation measures such as grazing bans and balance grazing have been implemented to control herders’ animal-stocking rates in the pastoral areas of northern China. However, previous literature has generally acknowledged that grazing restrictions have been ineffective in controlling overgrazing, as herders continue to graze illegally. This study provides the first empirical analysis that examines the mechanism through which a successful grazing restriction might occur and investigates the roles that each instrument component (restriction types, compensation, and monitoring) of the policy mix play in determining its effectiveness. The analysis is based on an unbalanced panel dataset of 348 herd households with 1025 observations surveyed from two major pastoral provinces in China during the years 2015-2017. A fixed-effects panel model is estimated to identify empirically the effects of grazing restrictions on herders’ grazing intensity and overgrazing. Results show that the grazing ban alone had an insignificant impact on overgrazing and that the effectiveness of the grazing ban critically depends upon monitoring. Surprisingly, we find that higher compensation levels in the grazing ban zones lead to increased grazing intensities. Further analysis shows that adequate monitoring is a necessary condition for a successful grazing restriction; data reflecting the monitoring on just 20.9% herders met desired criteria. We suggest that the current command-and-control measures should be replaced with an incentive-based approach that provides subsidies based on outcomes of actual stock-rate reduction. It is also crucial to enforce grazing restrictions by implementing adequate monitoring of herders’ grazing behaviour.

How to prevent negative online customer reviews: the moderating roles of monetary compensation and psychological compensation

PurposeThis paper aims to clarify the effects of motivations on negative online customer reviews (OCRs) behavior in an integrative framework and to identify the moderating role of monetary compensation and psychological compensation in the Chinese food and beverage industry.Design/methodology/approachData were collected from 377 consumers who posted a negative review online. Hierarchical regression analyses were used to test the research hypotheses.FindingsThe authors identified some characteristics of the consumers who posted negative online reviews in the Chinese food and beverage industry and found evidence that reveals the positive effects of emotional venting motivation and altruism motivation on posting negative customer online reviews. Economic motivation and self-enhancement motivation were not significantly connected to negative OCRs behaviors. Service recovery strategies can moderate the relationship between certain motivations and behaviors. The absence of psychological compensation will aggravate the influence of emotion venting motivation on consumers’ negative online reviews, while monetary compensation can restrain the influence of altruism motivation on negative online rating behavior.Research limitations/implicationsThis paper did not explore the effect of the fairness and timeliness of service recovery on negative OCRs behavior. This paper did not consider the different restaurant types and customers' characteristics, and future research can test similar models with different and more diverse samples.Practical implicationsWhen implementing service recovery strategies, it is important to consider the psychological component of recovery. The absence of psychological compensation aggravates the influence of high levels of emotion venting motivation on consumers’ negative OCRs, leading to a lower rating, more word comments and negative photos. High levels of monetary compensation can restrain the influence of altruism motivation on negative online rating behavior.Originality/valueThe current paper contributes to the hospitality management literature by investigating the motivations behind consumer decisions to post negative OCRs in a food and beverage context. In addition, the moderating effect that service recovery strategies have on this relationship was also explored in depth.

Stability Analysis on Torsional Interactions of Turbine-Generator Connected With DFIG-WECS Using Admittance Model

To evaluate the stability of Subsynchronous Torsional Interactions (SSTI), we propose a simple and effective approach using admittance model. The proposed approach gives the subsynchronous conductance based criterion to find the stability of torsional interactions. The subsynchronous conductance based approach is utilized to evaluate the impact of Doubly-Fed Induction Generator based Wind Energy Conversion System (DFIG-WECS) on the torsional vibrations of nearby turbine-generator. The damping of Induction Generator Effect (IGE) and SSTI is analyzed through admittance model at different wind speed with various compensation level. The results of admittance analysis are validated through eigenvalue analysis and transient simulation. The results show that, the DFIG-WECS reduces the damping of torsional modes in the low frequency region of subsynchronous network mode. The damping of SSTI reduces with increase in wind speed. Hence, the DFIG-WECS significantly destabilizes the low frequency torsional modes at high wind speed with high compensation level. Further, it is found that, the network conductance at all critical torsional modes marginally reduces with Subsynchronous Damping Controller (SSDC) at the inner loop of Grid Side Converter (GSC) controller compared to other locations in DFIG converter controllers.

The role of mediation in solving medical disputes in China

BackgroundMedical litigation represents a growing cost to healthcare systems. Mediation, arbitration, and other alternative dispute resolution (ADR) methods are increasingly used to help solve the disputes and improve healthcare satisfaction. In China, the increasing number of medical disputes has contributed to concern for the safety of physicians and mistrust between physician and patients resulting in ADR processes being established in several provinces in recent years. Our aim was to describe and explain the impact of this new mediation process in the Chinese healthcare system.MethodsOur study investigated mediation practices in China using case-level data from 5614 mediation records in Guangdong Province between 2013 and 2015. We investigated how the resolution success as well as the compensations are associated with the case characteristics using regression analysis.ResultsAmong the cases analyzed, 1995 (41%) were solved with agreement through mediation, 1030 were closed by reconciliation, 559 were closed by referring to court and 1017 cases were withdrawn after mediation. Five hundred five Yinao cases were solved with the help of mediators on the spot. We find that mediation solved about 90% of medical disputes under present mechanisms, while more police support is needed to cope with Yinao. The average compensation of mediation is CNY60,200 and average length of mediation is 87 days. Longer time taken to reach resolution and more money claimed by patients are associated with lower resolution success rate (p < 0.01) and higher compensation levels (p < 0.01).ConclusionOur results show the performance of mediation mechanisms in China to help solve medical disputes. ADR plays a role in reducing the need for initiating litigation and may ultimately increase satisfaction with the healthcare system.

The Nature of Crowd Work and its Effects on Individuals’ Work Perception

ABSTRACTCrowd work reflects a new form of gainful employment on the Internet. We study how the nature of the tasks being performed and financial compensation jointly shape work perceptions of crowd workers in order to better understand the changing modes and patterns of digital work. Surveying individuals on 23 German crowd working platforms, this work is the first to add a multi-platform perspective on perceived working conditions in crowd work. We show that crowd workers need rather high levels of financial compensation before task characteristics become relevant for shaping favorable perceptions of working conditions. We explain these results by considering financial compensation as an informational cue indicating the appreciation of working effort that is internalized by well-paid crowd workers. Resulting boundary conditions for task design are discussed. These results help us understand when and under what conditions crowd work can be regarded as a fulfilling type of employment in highly developed countries.

The Social-Psychological Perspective on Executive Compensation: Evidence From a Two-Tier Board System

This paper investigates whether and how three social-psychological factors − reciprocity, similarity and role experience − affect CEO compensation packages with respect to the levels of total and fixed compensation and the variable proportion of the compensation package. We use evidence from Germany as it is considered a prototype of a two-tier board system. Given the primary roles of the CEO and the chairman of the supervisory board, we especially highlight social-psychological aspects of the above-mentioned relationship and emphasize the mechanisms in the process leading to the final compensation package. Using a hand-collected dataset we find that reciprocity in particular can lead to a compensation package that is more favorable for the CEO. Results on similarity are ambivalent to the extent that similarity is not a universal construct. It is rather that the effects of similarity on CEO compensation − both positive and negative − depend on the dimension of similarity. Finally, the chairman’s role experience also plays an important role in shaping CEO compensation. More specifically, role experience leads to increased variable compensation. Hence, it is worth noting that higher compensation does not seem to be granted unconditionally, although this could be concluded from theory and prior literature. When higher levels of compensation are paid, the increase often stems from an increase in the proportion of variable compensation.

RARE-14. STRUCTURAL BRAIN PLASTICITY OF THE GRAY MATTER IN PATIENTS WITH BASAL GANGLIA GERM CELL TUMORS: A VBM STUDY

Abstract OBJECTIVE To assess the whole brain structural plasticity in case of unilateral basal ganglia germ cell tumors (BGGCTs). METHODS To detect changes in gray matter volume of the whole brain from structural Magnetic Resonance Imaging (MRI), we used voxel-based morphometry (VBM) in a sample of 41 patients with BGGCTs invading the left basal ganglia (BasalG_L group; n = 22) or the right basal ganglia (BasalG_R group; n = 19) and a sample of 16 patients with GCTs arising in pineal or suprasellar regions, comparing these groups with 16 age-matched normal controls (NCs) by two-sample t test after that. RESULTS To left BGGCTs patients, the regions of whole brain VBM analysis emphasized a large cluster of voxels with gray matter volume increase in left para hippocampal (k = 529 voxels, T=4.18, p&lt; 0.01) and decrease in left thalamus (k = 527 voxels, T=-4.88, p&lt; 0.01). At the same time, the cluster of voxels with gray matter volume increase in right middle cingulate cortex (rMCC) (k = 172 voxels, T=3.96, p&lt; 0.01), and decrease in right inferior frontal gyrus (rIFG), pars opercular (k = 495 voxels, T= -4.29, p&lt; 0.01) in right BGGCTs patients. Furthermore, gray matter volume showed no significant difference between groups of patients with GCTs arising in pineal or suprasellar regions and NCs by two-sample t test. And the results were corrected by family-wise-error correction. CONCLUSIONS The revealed results demonstrate that slow-growing but destructive lesion of the BGGCTs markedly and asymmetrically atrophies the gray matter volume in specific brain regions and shows compensatory plasticity in each side of cerebral hemisphere. Our findings direct focus on the whole cerebral adaptation that perhaps be a physiologic basis for the high level of functional compensation and partially explain the relationships between gray matter remodeling and cognitive disturbances observed in patients with BGGCTs.

The Everyday Compensation (EComp) Questionnaire: Construct Validity and Associations with Diagnosis and Longitudinal Change in Cognition and Everyday Function in Older Adults

The Everyday Compensation scale (EComp) is an informant-rated questionnaire designed to measure cognitively based compensatory strategies that support both everyday memory and executive function in the context of completing instrumental activities of daily living (IADLs). Although previous findings provided early support for the usefulness of the initial version of EComp, the current paper further describes the development, refinement, and validation of EComp as a new assessment tool of compensation for IADLs. Confirmatory factor analysis (CFA) was used to examine its factor structure. Convergent and predictive validity was evaluated by examining the relationship between EComp and markers of disease, including diagnosis, cognitive change, and trajectories of functional abilities. CFA supported a general compensation factor after accounting for variance attributable to IADL domain-specific engagement. The clinical groups differed in compensatory strategy use, with those with dementia using significantly fewer compensatory strategies as compared to individuals with normal cognition or mild cognitive impairment. Greater levels of compensation were related to better cognitive functions (memory and executive function) and functional abilities, as well as slower rates of cognitive and functional decline over time. Importantly, higher levels of compensation were associated with less functional difficulties and subsequently slower rate of functional decline independent of the level of cognitive impairment. Engagement in compensatory strategies among older adults has important implications for prolonging functional independence, even in those with declining cognitive functioning. Results suggest that the revised EComp is likely to be useful in measuring cognitively based compensation in older adults.

The Value of Financial Designations: A Consumer Perspective

Throughout their lifetimes, consumers use financial service professionals (FSPs) to achieve important financial goals and ensure financial wellbeing, often turning to FSPs as their levels of income and investable assets necessitate professional guidance. This study evaluates the impact of consumer perceptions of advisors' financial designations/credentials on rate of compensation to the FSP when controlling for consumer age, income, and investable assets. It further evaluates the impact of consumer perceptions of advisors' financial designations/credentials on consumers' perceived value received when controlling for consumer age, income, and investable assets. Using data from Advisor Impact's 2014 Economics of Loyalty Research survey, this study finds that consumers who value designations, as well as those with higher incomes and investable assets, pay advisors more than those who do not. The study also finds that consumers in older age groups tend to pay less to their advisors than the youngest age group, possibly indicating less of a need for financial advice. As a potential explanation for why those who value designations tend to pay more to their FSPs, the results regarding the perception of value received suggest that consumers who value designations also perceive greater value in return for the fees paid to their FSP. For advisors, these results provide support for the acquisition of designations as a means for greater perceived value on behalf of the consumer, and ultimately, higher levels of compensation.

The nexus between effective corporate monitoring and CEO compensation

Managerial compensation to top executives, particularly to CEO, has remained a topic of continuing interest in corporate finance literature. Corporations are required to pay a handsome amount to attract and motivate competent business executives to get their jobs done in a befitting manner. Accordingly, executives try to grab higher level of compensation for themselves which might be at the cost of harming firm value and shareholders' interests. In this context, various governing mechanism have been introduced to effectively monitor this opportunistic behaviour of executives. In this context, the current study empirically evaluates the impact of different corporate governance monitoring mechanisms such as institutional shareholders ownership and activism, independence of boards and audit committees, and presence of blockholders in company on level of compensation paid to CEO. The results revealed that more independent board and audit committee members meeting more frequently are helpful in mitigating the higher level of CEO compensation. Moreover, higher financial institutional ownership found positively related to CEO compensation which is in accordance with strategic alliance hypothesis between managers and sponsoring financial institutions.

Mathematical skills in children with pilocytic astrocytoma.

Pediatric patients with circumscribed cerebellar pilocytic astrocytoma (PA) tumors generally perform within the normal range on neuropsychological tests after a complete tumor resection. The outcome in academically relevant abilities such as mathematics, which in adults involve some cerebellar functions, is however much less understood. The aim of this study is to retrospectively investigate the neuroplasticity of mathematical skills and associated cognitive functions following cerebellar resection of PA in pediatric patients. Twenty-two children (mean age = 11.2+1.8), including 11 PA patients (females = 6) and 11 healthy controls (females = 6), were administered a battery of mathematical (MaT) and neuropsychological tests. Single-case statistical analyses were carried out (Crawford's t) as well as between-group comparisons (Wilcoxon test). Spearman correlations between MaT and neuropsychological tests were calculated. Thirty-six percent of the patients showed difficulties in some mathematical tasks, 50% of them within a broader cognitive deficit. Verbal working memory was associated with MaT performance both in patients and controls while, crucially, visuospatial memory, and visual-motor integration were associated with MaT in patients only. Among patients, MaT correlated negatively with tumor size and positively with the interval surgery test. The results evince an overall recovery of mathematical abilities despite PA in the majority of patients. This functional reestablishment is supported by visuospatial and visuomotor integration functions that contribute to set up emerging mathematical skills in these patients. Higher levels of compensation are found in more developed tumors as compared to smaller ones.

Public engagement in the context of a CHIM study.

Public engagement especially in new and contested areas of medical research is an essential ethical requirement. It helps to build trust, to embed ethical discourse in public beliefs and values and widen the accountability and the governance of biomedical research. Historically, ethical codes resulted from public protest following unethical medical research practices. Unethical practices do continue to a certain extent, primarily among unempowered communities. The need for public awareness, public deliberation and public advocacy are even more important in a country like India, where "research" is not understood, where paternalism on the part of the health professional, and the non-questioning attitude of the patient/participant have been customary, followed in recent times, by mistrust and an expectation of corruption in the public mind when dealing with a healthcare set up. CHIM studies carry various levels of unknowns. There are challenges of public non-comprehension of the need for being 'infected'; of families and communities being at risk; of possible high levels of compensation being offered as inducements; of other public health / preventive measures being supplanted. It is important for researchers and regulators in India not to rush into implementing such studies but to first engage with the public, listen to their concerns; and initiate deliberative mechanisms for public - researcher dialogue; and invest in public advocacy.

Contralesional macrostructural plasticity of the insular cortex in patients with glioma: A VBM study.

To assess the homotopic structural plasticity in case of unilateral damage of the insula. To detect changes in gray matter volumes of the contralesional insula from structural MRIs, we used voxel-based morphometry (VBM) in a sample of 84 patients with a diffuse low-grade glioma invading the left insula (insL group; n = 47) or the right insula (insR group; n = 37). The region of interest-based VBM analysis highlighted a large cluster of voxels with gray matter volume increase in the contralesional insula in both patient groups (k = 2,214 voxels for insL and k = 879 voxels for insR, p < 0.05, family-wise error corrected) compared with 24 age-matched healthy controls. Gray matter volume was increased for the entire insula (t 69 = 3.63, p = 0.0016 for insL; t 59 = 3.54, p = 0.0024 for insR, Bonferroni corrected), whereas no significant changes were found in 2 control regions for both patient groups. Furthermore, an increase of 24.6% and 31.6% in the gray matter volume was observed in the insula-related VBM cluster for insL and insR patients, respectively, compared with healthy controls (t 69 = 7.39, p = 2.59 × 10-10 and t 59 = 7.51, p = 3.61 × 10-10). The reported results demonstrate that slow-growing but massive lesion infiltration of the insula induces marked increase of gray matter volume in the contralateral one. Our findings give support for a homotopic reorganization that might be a physiologic basis for the high level of functional compensation observed in patients with glioma.

Tree size as a determinant of recovery of birch (Betula pendula and B. pubescens) and grey alder (Alnus incana) trees after cutting and inoculation with Chondrostereum purpureum

We investigated the ability of birch (Betula pendula Roth. and B. pubescens Ehrh.) and grey alder (Alnus incana (L.) Moench) trees of different sizes to recover after cutting and artificial infection with a common decay fungus, Chondrostereum purpureum (Pers. Ex Fr.) Pouzar. In birch, resistance to C. purpureum was initially highest among stumps of 13 cm diameter but by the end of the experiment almost all stumps were dead, whereas in grey alder mortality happened more slowly than in birch and was the same across the size range of stumps. After two growing seasons when almost all the original stumps were dead due to fungal infection, alder root suckers developed around small alder stumps, showing a high level of compensation compared to birch. These results indicate that birch and alder have different strategies for survival after biocontrol treatment.

The Relation between Public Managers’ Compensation and Governance

A vast literature in the field of public organizations has analyzed several factors of the compensation of government senior managers. However, the institutional factors associated with high levels of compensation of public managers are hardly known. In particular, studies about the possible relation between factors of governance and compensation of public managers are scarce. The statistical evidence here reveals that in the OECD countries, high levels of compensation for central government senior manager (standardized with GDP per capita) seem to be associated with low government effectiveness, low regulatory quality, low freedom, low rule of law and control of corruption (in short, bad governance). These results suggest insights for general reforms of governance aimed to support equitably levels of compensation of public managers and efficiency of public institutions.

Risk-Taking Incentives and Returns on R&amp;D Investment

Traditional finance theory suggests that riskier investments should yield higher returns. Challenging this notion, anecdotal and empirical evidence suggests that highly-incented managers may take on excessive risk, leading to greater losses, while other theoretical research argues that high levels of option-based compensation may actually lead to greater risk aversion, resulting in lower return investment choices. Therefore, we assess whether incentives associated with stock option compensation (“vega”), presumed to increase managers’ appetite for risk, uniformly yield higher returns on R&D investment. Our results suggest that the return on R&D, as measured by future earnings and patent awards, varies concavely with vega. That is, low to moderate levels of vega correspond to increasing returns on R&D, consistent with vega inducing more profitable investments, but marginal returns decline as vega increases. Supplemental analyses suggest that these results are driven by greater risk aversion rather than excessive risk-taking. Overall, our results imply that risk-taking incentives (i.e., vega) may prove counterproductive.

The Impact of U.S. News College Rankings on the Compensation of College and University Presidents

Widespread attention to college tuition and student loan debt has resulted in increasing scrutiny of high levels of compensation for college and university administrators. Prior research has sought to identify a “pay for performance” relationship in executive compensation, but discovered no clear link between presidential salaries and performance measures. This study proposes U.S. News & World Report college rankings as a highly meaningful performance metric and employs a fixed effects regression model to determine the relationship between college rankings and presidential salary. We find a significant relationship between rank and presidential salary at public universities, but not at private universities and liberal arts colleges, consistent with an academic capitalism model.