The determinants of top managers'' compensation

• Main Authors: Tzu-Hui Yang, 楊姿慧
• Other Authors: none
• Format: Others
• Language: zh-TW
• Published: 2010
• Online Access: http://ndltd.ncl.edu.tw/handle/54527457661519454518

碩士 === 國立中正大學 === 企業管理所 === 98 === In September 2008, Lehman Brothers declared bankruptcy, and has triggered the global financial tsunami. The financial crisis let public urged government to check the possible defects in compensation strategy. Why those high-paid executives didn’t have to pay for their mistakes but retired with golden parachute? This is really unfair to shareholders and the society. In 1984, management guru, Peter F. Drucker, made his famous and highly controversial argument: CEOs should not be paid over 20 times than employee’s average wage. However many top managers'' salaries are much higher than such level. Furthermore some top managers were paid 300 times higher than the employee’s average level. The justification in allocating the executives compensation should therefore be re-evaluated. We use the data from 2005 to 2008 listed companies'' financial statements and the top managers'' compensation record in Taiwan. And use the lagged model to analyze the determinants of top manager''s compensation in current business. We separate compensation into fixed pay and bonus to identify the possible determinant of these variables. The difference between this study and previous works are that this study will cut the industry into different sectors, which allows for better understanding in different sectors and their different compensation determinants. The results can provide business decision makers with more apparent perspective in regards to the compensation policies and have objective criteria to formulate salary policy.