Abstract
This article analyzes the effect of compensation consultants on executive pay practices. From a theoretical perspective, there are conflicting optimal contracting and managerial power related arguments on their role in the pay-setting process. Moreover, empirical evidence also indicates an academic debate on their role within the firm's corporate governance system. Overall, research so far still has not given a clear answer on whether they are part of the agency problem or they act at the shareholders' interest and thus contribute towards optimal contracting.
| Original language | English |
|---|---|
| Title of host publication | Wiley Encyclopedia of Management |
| Pages | 1-3 |
| Number of pages | 3 |
| ISBN (Electronic) | 9781118785317 |
| DOIs | |
| Publication status | Published - 1 Jan 2015 |
| Externally published | Yes |
Keywords
- agency theory
- compensation consultants
- corporate governance
- executive pay
- managerial power theory
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