Pay dispersion among the top management team and outside directors: Its impact on firm risk and firm performance

2017 ◽  
Vol 57 (1) ◽  
pp. 177-192 ◽  
Author(s):  
Pankaj C. Patel ◽  
Mingxiang Li ◽  
María del Carmen Triana ◽  
Haemin Dennis Park
Keyword(s):  
Firm Performance ◽  
Top Management Team ◽  
Management Team ◽  
Top Management ◽  
Outside Directors ◽  
Firm Risk ◽  
Pay Dispersion

Founder Versus Family Owners’ Impact on Pay Dispersion Among Non-CEO Top Managers: Implications for Firm Performance

2014 ◽  
Vol 43 (5) ◽  
pp. 1524-1552 ◽  
Author(s):  
Peter Jaskiewicz ◽  
Joern H. Block ◽  
Danny Miller ◽  
James G. Combs
Keyword(s):  
Firm Performance ◽  
Top Management Team ◽  
Management Team ◽  
Test Theory ◽  
Top Management ◽  
Panel Analysis ◽  
Top Managers ◽  
Pay Dispersion

Emerging evidence suggests that pay dispersion among non-CEO top management team (TMT) members harms firm performance, which raises questions about why firms’ owners tolerate or even support it. Prior research shows that the key distinction between founder and family owners is that in addition to firm performance and growth goals, family owners pursue socioemotional goals. On the basis of this distinction, we develop and test theory linking founders’ and families’ ownership to TMT pay dispersion. Consistent with our theory, a Bayesian panel analysis of Standard & Poor’s 500 firms shows that founder owners use less TMT pay dispersion and that family owners, relative to founder owners, use more, although that declines across generations. We also provide evidence that TMT pay dispersion harms firm performance. Our theory and results are significant because they help to explain why some owners favor compensation practices that cause TMT pay dispersion, despite evidence that this harms firm performance.

TMT pay dispersion and firm performance: the moderating role of organizational governance effectiveness

2015 ◽  
Vol 21 (4) ◽  
pp. 436-459 ◽  
Author(s):  
Gregorio Sanchez-Marin ◽  
J. Samuel Baixauli-Soler
Keyword(s):  
Firm Performance ◽  
Top Management Team ◽  
Management Team ◽  
Top Management ◽  
Job Complexity ◽  
Organizational Governance ◽  
The Board Of Directors ◽  
Pay Dispersion ◽  
Performance Examining ◽  
Organizational Hierarchies

AbstractThis study supports tournament theory in relation to high levels of organizational hierarchies, indicating that the job complexity facing the top management team supposes that pay dispersion positively influences firm performance. Examining a sample of 709 firm-year observations of Spanish listed companies spanning the period 2004–2012, our results indicate that the association between firm performance and top management team pay dispersion is conditional on the effectiveness of corporate governance. High top management team pay dispersion is associated with better performance in owner-controlled firms, where more effective monitoring is exerted by the board of directors.

The Impact of Top Management Team Demography on Firm Performance in China

2005 ◽  
Vol 4 (3) ◽  
pp. 227-250 ◽  
Author(s):  
Li-Qun Wei ◽  
Chung-Ming Lau ◽  
Michael N Young ◽  
Zhihui Wang
Keyword(s):  
Firm Performance ◽  
Top Management Team ◽  
Management Team ◽  
Top Management ◽  
The Impact

Top management team heterogeneity, corporate social responsibility and firm risk: an emerging country perspective

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mohammad Hassan Shakil ◽  
Nor Shaipah Abdul Wahab
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Top Management Team ◽  
Management Team ◽  
Top Management ◽  
Total Risk ◽  
Firm Risk ◽  
Content Type ◽  
Listed Firms ◽  
Corporate Social

Purpose This study aims to examine the effects of top management team (TMT) heterogeneity and corporate social responsibility (CSR) on the firm risk of Bursa Malaysia listed firms. Also, this study examines the moderating effect of CSR between TMT heterogeneity and firm risk. Design/methodology/approach This study uses panel regression models to test the hypotheses. The sample of this study is Bursa Malaysia non-financial listed firms from 2013 to 2017 with 3,055 observations. Findings This study finds significant effects of TMT age and tenure heterogeneities on total risk. Effects on idiosyncratic risk are evident only within age heterogeneity. Further, this study finds negative effects of CSR on total and idiosyncratic risks. CSR significantly moderates the relationship between total TMT heterogeneity and firm systematic risk. Practical implications This study reduces the literature gap by providing useful insights on the effects of CSR activities and TMT heterogeneity on firm risk. The findings can also provide hints to investors to assist them in assessing firm risk based on TMT heterogeneity and firms’ CSR. This study can also benefit shareholders in their attempts to mitigate the risk of their portfolio by investing in firms that are socially responsible as firms with high CSR suffer lower total and idiosyncratic risks. Originality/value Previous studies have emphasised on the influence of TMT characteristics and CSR on firm performance. However, studies that investigate the effects of TMT heterogeneity and CSR on firm risk are limited in the context of Malaysia.

Using Causal Mapping to Uncover Cognitive Diversity within a Top Management Team

2005 ◽  
pp. 203-232 ◽  
Author(s):  
David P. Tegarden ◽  
Linda F. Tegarden ◽  
Steven D. Sheetz
Keyword(s):  
Firm Performance ◽  
Top Management Team ◽  
Black Box ◽  
Top Management Teams ◽  
Management Team ◽  
Top Management ◽  
Cognitive Diversity ◽  
Causal Mapping ◽  
And Cluster Analysis ◽  
Cognitive Factions

The cognitive diversity of top management teams has been shown to affect the performance of a firm. In some cases, cognitive diversity has been shown to improve firm performance, in other cases, it has worsened firm performance. Either way, it is useful to understand the cognitive diversity of a top management team. However, most approaches to measure cognitive diversity never attempt to open the “black box” to understand what makes up the cognitive diversity of the team. This research reports on an approach that identifies diverse belief structures, i.e., cognitive factions, through the use of causal mapping and cluster analysis. The results show that the use of causal mapping provides an efficient and effective way to identify idiosyncratic and shared knowledge among members of a top management team. This approach allows the cognitive diversity of the top management team to not only to be uncovered, but also to be understood.

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