Executive compensation and dividend policy

White, Lourdes Ferreira

doi:10.1016/0929-1199(96)00003-x

Cited by 64 publications

(41 citation statements)

References 33 publications

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“…pay-out more dividends. This result is also consistent with the theory that firms link executives' compensation to dividend payments to reduce conflicts between shareholders and management (White, 1996). As predicted in the firm specific hypothesis, the variables: number of employees; debt to assets ratio; family dummy; and regulated dummy; are negatively associated with the CEO total pay.…”

Section: B Results Discussionsupporting

confidence: 88%

Executive Pay and Performance in Portuguese Listed Companies

2014

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This essay analyses the relationship between corporate governance practices and Chief Executive Officer (CEO) wages from a sample of Portuguese listed companies over the period from 2002-2011. The relationship between CEO total compensation and shareholders return, firm characteristics, CEO characteristics, board of directors and shareholders characteristics is analysed. It is found that firm specific factors accounts for the majority of the variance in total CEO pay, while firm performance accounts for less than 5%. It is also found that the CEO characteristics, board of directors' structures, and shareholders features are related with the CEO pay. The policy implications of these results are then derived.

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Section: B Results Discussionsupporting

confidence: 88%

Executive Pay and Performance in Portuguese Listed Companies

2014

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“…These results are consistent with some studies (White, 1996;Farinha, 2003) but inconsistent with others (Hu and Kumar, 2004;Sharma, 2011). We note that among the related studies, ours is the only one that employs a natural experiment to solve the endogeneity problem.…”

Section: Board Independence and Managerial Risk-taking And Payout Policysupporting

confidence: 86%

Does Board Independence Reduce the Cost of Debt?

Bradley

Dong

2014

SSRN Journal

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Using the passage of the Sarbanes-Oxley Act and the associated change in listing standards as a natural experiment, we find that while board independence decreases the cost of debt when credit conditions are strong or leverage low, it increases the cost of debt when credit conditions are poor or leverage high. We also document that independent directors set corporate policies that increase firm risk. These results suggest that, acting in the interest of shareholders, independent directors are increasingly costly to bondholders with the intensification of the agency conflict between these two stakeholders.

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“…Jagannathan et al (2000) and Guay and Harford (2000) find evidence that dividends are paid out of cash flows that are likely to be permanent, while stock 10 See Rozeff (1982), White (1996), Fenn & Liang (2001) and Nam, Wang & Zhang (2004) repurchases are paid out of cash flows that are not likely to be sustained indefinitely.…”

Section: Earnings Sustainabilitymentioning

confidence: 99%

The Effect of Shareholder Taxes on Corporate Payout Choice

Moser

2007

J. Financ. Quant. Anal.

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This study investigates whether the difference in individual shareholder tax rates between dividend income and capital gain (the dividend tax penalty) affects a firm's choice between distributing funds to shareholders through dividends or share repurchases. The results of this study suggest that, in periods in which the dividend tax penalty increases, firms are more likely to distribute funds to shareholders through share repurchases as opposed to dividends. The results also indicate that the relation between the dividend tax penalty and corporate payout choice is affected by the types of shareholders who own stock in the firm. As tax-disfavored institutional ownership increases and the dividend tax penalty increases, firms are more likely to repurchase shares as opposed to distributing dividends. In contrast, as tax-favored institutional ownership increases and the dividend tax penalty increases, firms are less likely to repurchase shares as opposed to distributing dividends. As senior managerial share ownership increases and the dividend tax penalty increases, firms are more likely to make distributions to shareholders in the form of share repurchases.

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Executive compensation and dividend policy

Cited by 64 publications

References 33 publications

Executive Pay and Performance in Portuguese Listed Companies

Executive Pay and Performance in Portuguese Listed Companies

Does Board Independence Reduce the Cost of Debt?

The Effect of Shareholder Taxes on Corporate Payout Choice

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