CCG research seminar with Sara de Masi, University of Florence
Masi will present the paper Incentive Compensation and Incentive Regulation: Empirical Evidence.
This paper examines the relationship between CEO pay and firm performance within a panel of European publicly listed energy utilities, focusing on the differential responses that arise from being subject to different regulatory regimes. In particular, we investigate the difference in payperformance sensitivity across regulated and unregulated firms as well as the impact of different regulatory schemes – incentive vs. cost-based regulation - on CEO monetary incentives. Using various measures of performance, we find that European energy utilities link CEO compensation to firm performance, although pay-performance sensitivity is lower for regulated companies. When we focus on the effect of alternative regulatory schemes, our results show that executive compensation is responsive to firm performance only within firms under incentive regulation. This result holds when we control for the presence of state-controlled utilities and for varying degrees of market liberalization across countries.
Date and time:
May 14, 2014, 12:00-13:00
Porcelænshaven 24, 2. floor, room 2.68
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