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What determines executives' remuneration in Malaysian public listed companies?

Most studies of the determination of executive compensation mainly focus on the Chief Executive Officer (CEO) compensation. However, determination of executives’ compensation is relatively ignored in the literature. This paper examines the impact of executives’ ownership, firm performance, board siz...

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Main Authors: Ghasemi, Maziar, Ab Razak, Nazrul Hisyam
Format: Conference or Workshop Item
Language:English
Published: Faculty of Economics and Management, Universiti Putra Malaysia 2017
Online Access:http://psasir.upm.edu.my/id/eprint/58737/1/22-NAZRUL.pdf
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spelling oai:psasir.upm.edu.my:58737 http://psasir.upm.edu.my/id/eprint/58737/ What determines executives' remuneration in Malaysian public listed companies? Ghasemi, Maziar Ab Razak, Nazrul Hisyam Most studies of the determination of executive compensation mainly focus on the Chief Executive Officer (CEO) compensation. However, determination of executives’ compensation is relatively ignored in the literature. This paper examines the impact of executives’ ownership, firm performance, board size and its components, as well as some other financial factors, on executives’ compensation in the context of Malaysia as an emerging economy. The data from 267 firms during 2006-2014 in the main market of Bursa Malaysia has been used. This paper finds that firm performance, leverage and number of non-executive directors have negative effects on executives’ compensation. Conversely, dividends, percentage of executives’ directors, board size and size of firms have positive effects on executives’ compensation. There is no evidence that executives’ ownership has significant effects on their compensation. From the viewpoint of the agency theory about the effects of larger boards, firm profitability, and executive percentage on executives’ compensation, it is perceived that the weak governance exists among listed companies in the Malaysian market. Considering the power of concentrated ownership in Malaysia, the insignificant impact of executives’ ownership on their remuneration is an important finding of this research. Faculty of Economics and Management, Universiti Putra Malaysia 2017 Conference or Workshop Item PeerReviewed application/pdf en http://psasir.upm.edu.my/id/eprint/58737/1/22-NAZRUL.pdf Ghasemi, Maziar and Ab Razak, Nazrul Hisyam (2017) What determines executives' remuneration in Malaysian public listed companies? In: Global Conference on Business and Economics Research (GCBER) 2017, 14-15 Aug. 2017, Universiti Putra Malaysia, Serdang, Selangor. (pp. 443-452). http://www.econ.upm.edu.my/upload/dokumen/20171011154541056-_NAZRUL.pdf
institution UPM IR
collection UPM IR
language English
description Most studies of the determination of executive compensation mainly focus on the Chief Executive Officer (CEO) compensation. However, determination of executives’ compensation is relatively ignored in the literature. This paper examines the impact of executives’ ownership, firm performance, board size and its components, as well as some other financial factors, on executives’ compensation in the context of Malaysia as an emerging economy. The data from 267 firms during 2006-2014 in the main market of Bursa Malaysia has been used. This paper finds that firm performance, leverage and number of non-executive directors have negative effects on executives’ compensation. Conversely, dividends, percentage of executives’ directors, board size and size of firms have positive effects on executives’ compensation. There is no evidence that executives’ ownership has significant effects on their compensation. From the viewpoint of the agency theory about the effects of larger boards, firm profitability, and executive percentage on executives’ compensation, it is perceived that the weak governance exists among listed companies in the Malaysian market. Considering the power of concentrated ownership in Malaysia, the insignificant impact of executives’ ownership on their remuneration is an important finding of this research.
format Conference or Workshop Item
author Ghasemi, Maziar
Ab Razak, Nazrul Hisyam
spellingShingle Ghasemi, Maziar
Ab Razak, Nazrul Hisyam
What determines executives' remuneration in Malaysian public listed companies?
author_facet Ghasemi, Maziar
Ab Razak, Nazrul Hisyam
author_sort Ghasemi, Maziar
title What determines executives' remuneration in Malaysian public listed companies?
title_short What determines executives' remuneration in Malaysian public listed companies?
title_full What determines executives' remuneration in Malaysian public listed companies?
title_fullStr What determines executives' remuneration in Malaysian public listed companies?
title_full_unstemmed What determines executives' remuneration in Malaysian public listed companies?
title_sort what determines executives' remuneration in malaysian public listed companies?
publisher Faculty of Economics and Management, Universiti Putra Malaysia
publishDate 2017
url http://psasir.upm.edu.my/id/eprint/58737/1/22-NAZRUL.pdf
_version_ 1819297876461748224
score 13.4562235

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