高管薪酬分散公司治理与企业绩效.doc

本科毕业论文（设计）外 文 翻 译原文：Executive pay dispersion, corporate governance, and firm performanceExecutive compensation has been a central research topic in economics and business during the past two decades, recently gaining impetus in the wake of corporate scandals that have exposed significant vulnerabilities in corporate governance and the subsequent far reaching regulatory changes (SarbanesOxley). Prior research into executive compensation has primarily focused on issues related to the level and structural mix of compensation packages, and their sensitivity to firm performance (Lambert and Larcker 1987; Jensen and Murphy 1990; Yermack 1995; Baber et al. 1996; Hall and Liebman 1998; Core et al. 1999; Murphy 1999; Bryan et al. 2000). Early compensation studies focused on the CEO, subsequently expanding the scope to the compensation of the entire managerial team. Thus, for example, Aggarwal and Samwick (2003) report that managers with divisional responsibilities have lower payperformance sensitivities than do managers with broad oversight authority, who in turn have lower payperformance sensitivities than does the CEO, concluding that payperformance sensitivity increases with the span of authority. Similarly, Barron and Waddell (2003) examine the characteristics of compensation packages of the five highest paid executives and find that higher rank managers have a greater proportion of incentive-based compensation in pay packages than do lower ranked executives.The issue of pay dispersion across managerial team members has received conceptual attention by labor economists and organization theorists, yet scant empirical research has been performed to date. In this study, we investigate empirically the effect of managerial compensation dispersion on firm performance. We draw on two competing modelsthe tournament theory and equity fairness argumentsto formulate our hypotheses: Tournament theory (Lazear and Rosen,1981) views the advancement of executives in the corporate hierarchy as a tournament in which individuals compete for promotion and rewards. High-performing executives with considerable managerial potential win promotion and commensurate compensation. A large spread of compensation across corporate hierarchical levels attracts talented and venturesome participants to compete in the managerial tournament, providing extra incentives to exert effort. The winners talent and the extra effort exerted will, according to the tournament model, translate to high firm performance.The empirical evidence on the tournament theory is rather limited and results are mixed. Supporting evidence comes from studies of sport activities (Ehrenberg and Bognanno,1990; Becker and Huselid,1992) and by controlled experiments (Bull et al.,1987). In business settings, Main et al. (1993), using survey data for top executives in 200 US firms, during 19801984, report that a greater spread of top-executive compensation is positively related to firm performance. Similarly, based on proprietary data of 210 Danish firms during 19921995, Eriksson (1999) provides somewhat weak evidence that higher pay dispersion is positively related to firm performance. In contrast, OReilly et al. (1988) do not find support for the tournament argument in a sample of 105 Fortune 500 firms, and Conyon et al. (2001) report that variation in executive compensation is not associated with enhanced firm performance in a sample of 100 UK firms in 1997.In contrast with the tournament model, notions of equity fairness postulate that the quality of social relations in the workplace affect firm performance (Akerlof and Yellen,1988,1990; Milgrom,1988; Milgrom and Roberts,1990) and that large pay dispersion adversely affects employee relations and morale, leading to counterproductive organizational activities, which eventually reduce firm performance. Supporting evidence for the adverse effects of wage dispersion on performance is also limited. Using a sample of university faculty, Pfeffer and Langton (1993) report that greater wage dispersion within academic departments reduces faculty satisfaction as well as research productivity and collaboration among colleagues. There is also some preliminary evidence in business settings (Drago and Garvey,1998) that supports the argument for equity fairness.In this study we examine a sample of 12,197 firm-year observations for 1,855 US companies spanning the period 19922003, and find that firm performance, measured by Tobins Q and alternatively by stock returns, is positively associated with the compensation dispersion of the firms top-management team. Additionally, we document that firms with large compensation dispersion have higher future return on assets (ROA) than comparable lower pay dispersion companies. Collectively, our results suggest that the compensation dispersion of the top management team is positively related to firm performance.Our analysis also indicates that the association between firm performance and pay dispersion is conditional on agency costs and corporate governance structure. Specifically, high pay dispersion is associated with better performance in firms with high agency costs related to managerial discretion (e.g., firms with large R&D expenditures). This finding supports the notion that in firms with assets or activities that are difficult for shareholders to monitor, a greater pay dispersion mitigates some of the managersshareholders agency costs by motivating managers to improve long-term firm performance. Our findings are also consistent with prior studies result that firms with high growth opportunities are more likely to substitute direct monitoring with equity-based compensation incentives to reduce agency costs of managerial discretion (Smith and Watts,1992; Gaver and Gaver,1993; Bryan et al.,2000). We further find that the positive association between firm performance and pay dispersion is stronger for firms with more effective corporate governance. Specifically, firms with a high proportion of outside directors on the board and with CEOs who are not board chair have a stronger positive association between firm performance and pay dispersion. Thus, our results corroborate the complementary roles of compensation contracts and corporate governance in reducing agency costs (Mehran,1995; Hartzell and Starks,2003).This study contributes to the managerial compensation research on several dimensions. Primarily, it provides comprehensive and updated evidence that managerial compensation dispersion is positively associated with firm performance. Pay dispersion per se was so far a somewhat neglected area in managerial compensation research. Our study thus contributes to recent research that focuses on the executive-team compensation (Aggrawal and Samwick,2003; Barron and Waddell,2003), compared to prior compensation research that was often restricted to the CEO. This study also extends the literature on the interaction between corporate governance and the structure of managerial compensation. For the corporate governance strand of research we show that improved governance structures (such as a higher proportion of independent board members and separation of the CEO and Chairman positions) enhances the positive association between pay dispersion and firm performance. Thus, corporate governance and managerial pay dispersion are complementary and perhaps mutually enhancing mechanisms for strengthening firm performance. In the context of shareholdersmangers agency costs, we provide evidence suggesting that managerial pay dispersion can potentially mitigate agency costs in firms that are difficult to monitor. More generally, our study supports the notion that the structure of executive compensation affects agency costs and firm performance.Prior research and our hypotheses1. Tournament theoryThis theory (Lazear and Rosen,1981) views the advancement of executives in a corporate hierarchy as a contest in which individuals compete for promotion and rewards. High-performing executives win promotions and receive prizes in the form of generous pay and perks in their new positions. The compensation spread across hierarchical levels (largeprizes at the top) provides extra incentives to participate in the managerial tournament and exert considerable efforts to win the top prize. The main elements of the tournament theory are as follows: (i) Tournaments reward players with prizes based upon relative performance. The best performer receives the largest prize while the worst performer receives the smallest. (ii) Rewards are intrinsically nonlinear. (iii) The spread in prizes increases with the number of competitors. (iv)Participants with low ability will choose higher risk strategies to increase the probability of winning. Thus, a participants ability is negatively related to the variability of his/her performance.Empirical evidence supporting the tournament theory was obtained in sport settings. For example, Ehrenberg and Bognanno (1990) examine the performance of golfers and conclude that as prize differentials increase, players performance improves. Becker and Huselid (1992) examine the performance of drivers in professional auto racing, and report that pay dispersion has positive incentive effects on both individual performance and driver safety. In a business setting, Main et al. (1993) use survey data for 200 firms during 19801984 and report that pay differential increases substantially as one ascends the corporate hierarchy, consistent with tournament theorys prediction that extra weight on top-ranking prizes motivates participants to aspire to higher goals, and that the dispersion in top compensation increases with the number of contestants. The main finding of Main et al. (1993) is that firm performance is positively associated with executive pay dispersion. In a similar vein, Bognanno (2001) reports that the CEO pay rises with the number of vice-presidents competing for the top position. However, he finds that inconsistent with the tournament prediction, firms do not maintain short-term promotion incentives, as longer time in position prior to promotion reduces the effect of pay increase from the promotion. Finally, Conyon et al. (2001) examine a sample of 100 large UK firms during 19971998 and find no evidence that larger pay dispersion is positively associated with improved firm performance. OReilly et al. (1988) report similar findings for the United States. Thus, the business-setting evidence on the tournament theory is mixed and somewhat dated.2. Equity fairnessEconomic theory asserts that in equilibrium wages are equal to employees marginal productivities. Such mainstream thinking has been challenged: Drawing on social exchange models, equity notions, and related work in sociology and psychology, Akerlof and Yellen (1988, 1990), Milgrom and Roberts (1988), and Levine (1991) argue that low pay dispersion may have a positive effect on employee efforts and productivity by creating harmonious and efficient labor relations thereby leading to higher output and productivity. In a similar vein, Levine (1991) develops a model showing that lowering pay dispersion can increase employee cohesiveness, which in turn will enhance productivity.Further insight into the economic efficiency associated with a low pay dispersion is provided by Lazear (1989), and Milgrom and Roberts (1990): If promotion and salaries are based on relative rather than individual performance, as postulated by tournament theory, then employees will advance not only by performing well, but also by seeing to it that their rivals perform poorly. Consequently, employees have weaker incentives to cooperate, and in extreme cases may engage in outright sabotage of others activities. To mitigate this, a firm may encourage cooperation by, among other things, reducing pay dispersion. Low dispersion may reduce effort, but at the same time increase cooperation. Thus, in general, it is optimal on productivity grounds to compress wage structure, to some extent, to promote cooperation (Lazear,1989).4 In a similar vein, Milgrom and Roberts (1990) use the principal-agent framework to suggest that employees may engage in rent-seeking activities to secure influence over organizational decision processes. Such influence-oriented activities arise when organizational decisions affect the distribution of wealth or other benefits among members or constituent groups. In their selfish interest, the affected individuals attempt to influence the decision process to their benefit. Furthermore, if firms cannot perfectly monitor output, workers may have incentives to exaggerate their output and lobby for higher wages. Thus, for example, the proponents of a project (e.g., R&D) may devote excessive effort to build the best possible case for investing in that project, hiding potential difficulties and focusing on the upside, while at the same time trying to denigrate competing proposals. Such arguments have led Milgrom and Roberts (1990) to promote wage compression under certain circumstances to alleviate these counterproductive activities.Empirical tests of the above equity fairness arguments include the work of Pfeffer and Langton (1993), who report that the higher the wage dispersion of university faculty, the lower their satisfaction and research productivity and the less likely it is that faculty members will collaborate on research. Similarly, Cowherd and Levine (1992) report a positive relationship between product quality and various measures of interclass pay equity (low wage dispersion). Drago and Garvey (1998) report that strong promotion incentives are associated with reduced employee cooperation and individual efforts. Contradicting the equity fairness predictions, Hibbs and Locking (2000) report that compression of wage dispersion in Swedish companies depressed output and labor productivity.Source: Kin Wai Lee,Baruch Lev,Gillian Hian Heng Yeo,2008Executive pay dispersion, corporate governance,and firm performance.Reviewof Quantitative Financeand Accounting, Vol.30,pp.315-338.译文：高管薪酬分散，公司治理，与企业绩效管理人报酬在过去二十年来是经济和商业中心的研究课题，最近在公司丑闻曝光后，已获得在公司治理中的漏洞和随后的重大深远（萨班斯）监管改革的动力。在此之前，改为执行制度的研究主要集中在有关水平和结构组合的报酬方案上，公司业绩的敏感性（兰伯特和拉克尔，1987年；詹森和墨菲，1990年； Yermack，1995；巴伯等，996年；霍尔和利伯曼，1998年，科尔等，1999年；墨菲，1999年；布莱恩等，2000年）。早期的研究主要集中在CEO的报酬，后来扩大范围到整个管理团队的报酬。因此，举例来说，Aggarwal和Samwick（2003年）的报告称，有责任的高层管理人员更具有广泛的监督权力，反过来谁具有比该公司首席执行官较低工资敏感性，得出的结论是支付性能与权威的跨度敏感性增加。同样，Barron和沃德尔（2003年）研究的五名最高薪行政人员薪酬方案的特点发现，较高职级的管理人员在薪酬的激励补偿大于低排名行政人员。薪酬管理团队成员分散各地的问题已受到劳动经济学家和组织理论家的关注，但迄今已进行的概念缺乏实证研究。在这项研究中，我们调查评价了企业经营者报酬与企业绩效关系的分散。我们利用两个竞争模型，理论和产权竞赛的公平性参数，制定我们的假设：Tourna -ment理论（拉齐尔和罗森，1981年）的意见，在企业层次的一场比赛中，个人晋升和奖励的管理人员竞争地位。高级管理人员的潜力相当大的不良宣传和相应的管理人员获得赔偿。大量的赔偿遍布企业等级层次吸引人才的竞争和冒险参加比赛的管理，提供额外的奖励尽的努力。获奖者的才华和施加额外的努力，将按照比赛模式，转化为高公司业绩。在比赛的经验证据理论是相当有限的，结果是喜忧参半。支持的证据来自体育活动（朗贝格和Bognanno，1990年；贝克尔和Huselid，1992年）的研究和控制的实验（布尔等，1987年）。在商业环境中，主营等（1993年），使用在美国公司高层管理人员200名调查数据，在1980-1984年的报告说，高管薪酬更快的传播与公司绩效呈正相关。同样，基于对丹麦1992-1995年间210家公司的专有数据，埃里克森（1999年）提供的证据表明，有些弱较高层薪水分散与公司业绩是正相关。与此相反，奥赖利等（1988年）没有找到一个样本为比赛论，105财富500强公司，以及康勇等人（2001年）报告说，行政补偿的变化与一个英国公司在1997年的抽样调查100增强公司业绩是不相关的。与模型对照的比赛，公平公正的观念推断是社会关系的工作质量影响公司业绩（阿克洛夫和耶伦，1988年，1990年；米尔格罗姆，1988年；米尔格罗姆和罗伯茨，1990年），而大分散不利影响雇员的工资关系和士气，导致适得其反的组织活动，并最终减少企业绩效。支持工资色散性能产生负面影响的证据也是有限的。使用的是大学教师样本，Pfeffer和兰顿（1993年）报告说，在学术部门更加分散降低教师工资的满意度以及研究生产力和同事之间的协作。也有一些企业初步证据设置（德拉戈和加维，1998年），支持对公平公正的说法。在这项研究中，我们研究了12197家公司，1855年美国公司横跨1992-2003年期间取样调查，发现公司绩效，托宾的Q衡量和股票收益或者，正相关的赔偿分散的企业的高层管理团队。此外，我们的文件，与大型企业有较高的色散补偿将来付出比同类低分散公司的资产率（ROA）的回报。总的来说，我们的结果表明，补偿高层管理团队分散是正相关的公司业绩。我们的分析还表明，公司绩效和薪酬之间的关联是分散在代理成本和公司治理结构的条件。具体来说，待遇高分散性与更好的表现在企业的代理成本高与管理决定有关（例如，用大的RD支出的公司）。这一发现支持这一概念与资产或活动，难以监控的企业为股东，付出更大的分散减轻了管理人员与股东的一些机构通过激励管理成本，提高长期的公司业绩。我们的研究结果也与以往的研究结果相联系，具有高增长机会的公司更可能以替代股票为基础的薪酬激励直接监测，以减少管理自由裁量权（史密斯和Watts，1992年；Gaver，1993年；布莱恩等，2000年）。我们进一步发现，公司绩效和薪酬之间的正相关性是分散的企业更强更有效的法人治理结构。具体来说，有外部董事在董事会与CEO等高层公司董事会主席之间有一个坚定的性能和较强的正相关分散支付。因此，我们的结果证实在降低代理成本补偿合同和公司治理的互补作用（迈赫兰，1995年；哈策尔和斯塔克斯，2003年）。这项研究有助于在多个层面的管理补偿研究。首先，它提供全面及最新的证据表明，企业经营者报酬的分散与企业绩效呈正相关。分散支付本身是迄今为止有点忽略了企业经营者报酬的研究领域。从而有助于我们的研究最近的研究，对行政团队的补偿（Aggrawal和Samwick，2003；Barron和沃德尔，2003年）的重点，而优先受偿的研究，往往局限于行政总裁。这项研究还扩展了对公司治理与企业经营者报酬结构的相互作用文学。为研究公司治理链，我们表明，改善治理结构（如独立董事成员的人口比例与行政总裁及主席职务分离）增强了与企业之间的支付分散呈正相关性。因此，公司治理和管理分散支付，或许是相辅相成相互促进的机制，加强企业绩效。在股东，经理人代理成本方面，我们提供的证据表明，分散支付的管理有可能减轻企业是很难监控的代理成本。更一般地，我们的研究支持这一观点，即行政