Work

The relations of corporate risk, operating efficiency, and firm size to managerial compensation: Evidence from Taiwan stock market-listed companies

Year: 2022

Type: article

Abstract: This study uses Taiwan stock market-listed company data to analyze relationships between managerial compensation, corporate risk, and operating efficiency. This study focuses on three aspects. First, we examined how different types of corporate risk can relate differently to top manager salaries. Second, we investigated whether management efficiency is associated with managerial compensation in Taiwan. Last, we explored how firm size moderates the relationships between top-manager salaries, corporate risk, and operating efficiency. Our findings reveal that credit risk is remarkably different from other risks related to managerial compensation. Moreover, the moderating effect of firm size varies across various factors. Furthermore, most estimated results supported all our hypotheses. We provided subsequent explanations for the outcomes. The particular phenomenon found in this study also gave implications for the contract design of managerial compensation.

Source: Asia Pacific Management Review

DOI: 10.1016/j.apmrv.2022.09.001

Authors: Lieh-Ming Luo, Hui-Tzu Lee, Chia-Chou Chiu, Chih-Wei Lee

Institutions: Fu Jen Catholic University, Chung Yuan Christian University, National Taipei University of Business

Language: English

Topic: Corporate Finance and Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: hybrid

Estimated APC paid: $1,500