1、2200 单词， 3970 汉字 出处 :Turki Alshimmiri,2004.“Board Composition, Executive Remuneration, And Corporate Performance: The Case Of Reits”.Corporate Ownership & Control August.pp.104-112. Board Composition, Executive Remuneration,And Corporate Performance: The Case Of Reits Introduction Stockholders in mo
2、dern corporations are the residual risk bearers. As they dont have the expertise to run their firms, stockholders must rely on the firmsmanagement team. Jensen and Ruback (1983) defined the management team as the top managers as well as the board of directors of the firm. The separation between owne
3、rship and control in the modern corporation creates the incentives for managers to pursue their self-interest goals and not to maximize the shareholders wealth in what is termed in the literature as the agency conflict. Researchers have suggested many mechanismsby which managers are curbed from maxi
4、mizingsolely their own utilities.These mechanisms (seeAgarwal and Knoeber 1996) can be either externalones, such as market for corporate control or internalones, such as the board of directors. The board ofdirectors is a basic element of corporate governance.The main functions of corporate boards ar
5、e evaluating and approving strategies formulated by managers, providing an appropriate vehicle for stock holders desiring representation in company boards, and performing vigorous monitoring of managers actions to make sure that decisions by top managers come in line with shareholders interests. The
6、 literature is rich with studies that have shown the positive effect of the outside board members on firm value .The theory says that the way a board of directors is formed is intended to minimize the agency conflict costs. Also, some studies have shown how the size of the board affects corporate va
7、lue (Yermack 1996； Zahra et al. 1989； Eisenberg et al. 1998). Consequently, the board of directors is an important governance mechanism that ensures that the interests of shareholders and management are closely aligned, which would have its effects on corporate performance. In addition to the intern
8、al mechanisms that mitigate agency conflicts, managerial remuneration is an important device that can be used effectively to align the interests of stockholders and managers. The extent to which the remuneration package can achieve that alignment of interests is an empirical question. From a theoret
9、ical point of view, managerial remuneration should correlate weakly with corporate performance. The annual bonus usually is given in good as well as bad performance times. Good performance pushes the bonus up while bad performance does not depress the bonus. However, empirically, the relationship be
10、tween management remuneration and corporate performance was detected and shown to exist. Generally, studies have found that there is a positive relation between managerial remuneration and corporate performance (Hamid 1995； Davis et al. 1994； Finnerty et al. 1993). Managerial remuneration and corpor
11、ate performance The issue of managerial incentives has been heavily researched in financial economics. Managerial incentives, at least from a theoretical point of view, have an energetic effect on mitigating the moral hazard problem inherited in individual contracts. This would have a major impact u
12、pon firms financial performance. Hamid (1995) examined the relationship between CEO compensation structure, ownership, and firm performance. He mainly focused upon the equity type of compensation not the cash compensation. His results confirmed a significant positive relationship between CEO equity
13、compensation and firm Performance. Other types of compensation also have a positive effect on corporate performance even after considering some control variables. Davis and Shelor (1995) also documented a significant relationship between executive total compensation, firm size, and firm performance.
14、 Cannon and Vogt (1995) used Jensens measure to proxy for REITs financial performance and examined how severe the agency costs in REITs are. They find that advisor REITs with lowdirector ownership tend to underperform and pay higher advisor payments than do their counterparts with high ownership. Th
15、ey find no such relationship for self-administered REITs. These results show that self-administered REITs make better use of marketbased performance compensation than do advisor REITs. Lewellen, Loderer, Martin, and Blum (1992) found that there is a significant relationship between managerial compen
16、sation and firm economic performance. Their results confirmed that compensation packages are designed to mitigate the agency conflict costs. In most previous studies, the relation between managerial remuneration and corporate performance was examined and shown to be positive when using total remuner
17、ation package, which includes usually (1) base cash remuneration, (2) incentive cash remuneration, (3) stock options, and (4) relative performance remuneration. This study, however, is concerned only with cash remuneration since it represents about 80% of total remuneration package. Board compositio
18、n and financial performance The issue of board composition has deep roots in financial economics literature. Whether the way board of directors is formed can affect the economic value and performance of a firm has been investigated by a lot of researchers.The empirical evidence not solidly convincin
19、g regarding this issue when considering the entire literature, although many empirical studies support a positive relationship between boards dominated by outside directors and corporate performance. Cotter, Shivdasani, and Zenner (1997) documented evidence showing the positive effect of the outside
20、 directors on corporate performance as they found that shareholders gains from tender offers would be greater for targets with independent board members than for other targets. Rosenstein and Wyatt (1994) examined the wealth effects when an officer of one public corporation joins the board of direct
21、ors of another corporation. They find that the nonfinancial sending firms experience negative returns while the receiving firms do not gain from these appointments. This suggests that when executives join boards of other corporations, they become distracted from shareholders wealth maximization obje
22、ctive. The financial sending firms experience positive returns when sending their officers to other firms. Barnhart et al. (1994) investigated the effect of board composition on company performance. When they do not control for variables that have effects on company performance, the relationship between corporate performance, proxied by market-to-book ratio of equity, and board composition is significant. When they account for managerial ownership and variation across
