Abstract
One of the main control mechanisms that shareholders have used to rein in rogue managers is compensation. Through a combination of intrinsic and extrinsic incentives, shareholders have tried to provide the right balance to motivate senior managers to perform at their best. Shareholders have often failed in achieving this balance through compensation. In this paper, we argue that this failure is not the result of compensation packages as such, but on the focus of compensation packages on extrinsic motivators such as pay-for-performance bonuses and stock options. Instead, the focus of compensation packages should be on cultivating intrinsic motivators such as firing and prestige.
Original language | English |
---|---|
Pages (from-to) | 24-31 |
Number of pages | 8 |
Journal | Corporate Ownership and Control |
Volume | 11 |
Issue number | 1 |
DOIs | |
Publication status | Published - 01 Jan 2013 |
Externally published | Yes |
Keywords
- Agency theory
- CEO
- Compensation
- Corporate governance
- Motivation
ASJC Scopus subject areas
- General Business,Management and Accounting