The Impact of CEO Incentive Compensation and Compensation/Audit Committees Overlap on Productive Efficiency

• Main Authors: Hsiao-Yen Lo, 羅孝妍
• Other Authors: Chia-Chi Lu
• Format: Others
• Language: zh-TW
• Published: 2014
• Online Access: http://ndltd.ncl.edu.tw/handle/tp5x32

碩士 === 國立中央大學 === 會計研究所 === 102 === This study uses 2005-2012 data of all the US firms. We examine the relationship between CEO incentive compensation, compensation/audit committees overlap and technical productive efficiency. We use stochastic frontier analysis model which the parameters of a stochastic frontier function are estimated simultaneously with the inefficiency effects. After controlling for the industry, CEO incentive compensation is positively related to productive efficiency. However, compensation/audit committees overlap is negatively related to productive efficiency. Last, we examine whether and how the relationship between CEO incentive compensation and productive efficiency will be influenced under compensation/audit committees overlap. We find that the intersection of CEO incentive compensation and compensation/audit committees overlap is negatively related to productive efficiency. It implies the importance of corporate governance and board structure. In sum, the results suggest that both the structure of CEO compensation and board are important factors when assessing the productive efficiency and economic performance of firms.