CEO Compensation And Firm Performance: Is There Any Relationship?

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Catherine T. Jeppson
California State University, Northridge

Wayne W. Smith
California State University, Northridge

Ronald S. Stone
California State University, Northridge

Keywords

Executive compensation, firm performance, chief executives

Abstract

Recent media and public attention has focused on CEO compensation.  This study looks at the relationship between CEO compensation and several measures of firm performance across a wide variety of industries.  The study used a database of CEO compensation for 200 large public companies which filed proxy statements with the SEC for 2007.  Total CEO compensation consists of:  base salary, cash bonuses, perks, stock awards, and option awards.  The measures of firm performance were:  company revenue, year-to-year change in net income, and year-to-year change in total shareholder return (TSR).  Correlation and regression analysis were used to test various hypotheses.  We expected that total CEO compensation and its components would be directly related to financial measures of company performance.

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Published
Nov 1, 2009
DOI https://doi.org/10.19030/jber.v7i11.2357

Article Details

How to Cite
Jeppson, C. T., Smith, W. W., & Stone, R. S. (2009). CEO Compensation And Firm Performance: Is There Any Relationship?. Journal of Business & Economics Research (JBER), 7(11). https://doi.org/10.19030/jber.v7i11.2357
Issue
Vol. 7 No. 11 (2009)
Section
Articles