The composition of the remuneration committee and the vertical pay gap: the role of proprietary directors in Spain

Acero, Isabel (Universidad de Zaragoza) ; Alcalde, Nuria (Universidad de Zaragoza)

Resumen: Purpose
This study investigates whether the proportion of proprietary directors (blockholders or their representatives) on the board's remuneration committee influences vertical pay inequality in Spanish listed companies and whether this relationship can be conditioned by the concentration of ownership.
Design/methodology/approach
The sample contains information on the individual compensation of 1048 directors of 57 Spanish listed firms during the period 2013–2018 making up an unbalanced panel with 3565 observations. Panel data regressions are used to study how the presence of proprietary directors on the remuneration committee influences the remuneration of directors, focusing not on their absolute remuneration levels, but rather on their relationship to the average remuneration of the organization's employees (as a measure of vertical pay inequality within the company). The authors also investigate whether this relationship is conditioned by firm ownership concentration.
Findings
The results indicate that the presence of proprietary directors on the remuneration committee acts as a mechanism to reduce vertical pay inequality, even in the context of high ownership concentration.
Originality/value
Unlike the majority of previous research dedicated to the independence of the remuneration committee, this study focuses on the role played by proprietary directors. The results help elucidate the importance of proprietary directors to properly monitor and restrain directors' compensation in contexts of high ownership concentration.

Idioma: Inglés

DOI: 10.1108/BJM-09-2022-0354

Año: 2023

Publicado en: Baltic Journal of Management 18, 3 (2023), 386-401
ISSN: 1746-5265

Factor impacto JCR: 2.4 (2023)

Categ. JCR: MANAGEMENT rank: 217 / 407 = 0.533 (2023) - Q3 - T2

Factor impacto CITESCORE: 5.4 - Business and International Management (Q2) - Marketing (Q2) - Strategy and Management (Q2) - Management of Technology and Innovation (Q2) - Organizational Behavior and Human Resource Management (Q2)

Factor impacto SCIMAGO: 0.741 - Business and International Management (Q2) - Management of Technology and Innovation (Q2) - Strategy and Management (Q2) - Organizational Behavior and Human Resource Management (Q2) - Marketing (Q2)

Financiación: info:eu-repo/grantAgreement/ES/DGA-FEDER/S52-20R
Financiación: info:eu-repo/grantAgreement/ES/MICINN/PID2021-123154NB-I00

Tipo y forma: Artículo (PostPrint)

Área (Departamento): Área Organización de Empresas (Dpto. Direcc.Organiza.Empresas)