THE ROLE OF CORPORATE GOVERNANCE IN EXECUTIVE COMPENSATION SYSTEM

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Yusuf Mohammed Nulla ORCID logo

https://doi.org/10.22495/cocv12i4c4p5

Abstract

This research study explores the relationship between the executive compensation and corporate governance among the New York Stock Exchange (NYSE) and the Toronto Stock Exchange (TSX/S&P) companies from 2005 to 2010. The quantitative research method was selected for this research study. The eighty largest companies from the New York Stock Exchange and the Toronto Stock Exchange were selected. The random sample method was used to select the two populations from each index. The research question for this research study was: is there a relationship between CEO cash compensation and corporate governance among the Toronto Stock Exchange and the New York Stock Exchange companies. The four statistical regression models found that there was a weak relationship between corporate governance and executive compensation among the TSX/S&P and the NYSE populations. Also, the Pearson correlation results indicated that the corporate governance has a minimal role towards the determination of the executive compensation.

Keywords: Corporate Governance, Executive Compensation, Corporate Reporting, CEO Power, Management Accounting

How to cite this paper: Nulla, Y. M. (2015). The role of corporate governance in executive compensation system. Corporate Ownership & Control, 12(4-4), 467-479. https://doi.org/10.22495/cocv12i4c4p5