The Impact of Executive Compensation on the Post-Merger Integration of U.S. And German Firms

Download or read book The Impact of Executive Compensation on the Post-Merger Integration of U.S. And German Firms written by Anja Tuschke and published by . This book was released on 2003 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Based on research in management compensation and on the theory of international diversification, this paper analyzes the impact of executive compensation on the success of mergers and acquisitions (Mamp;A) between U.S. and German firms. The results show that differences in the level and structure of U.S. and German executive compensation packages impair incentives, monitoring efforts, and management`s willingness to innovate. Cooperation across national boundaries, a collective goal orientation, and the accumulation of social capital are hindered. Depending on the type of diversification, the joint firm faces a trade-off between the realization of synergies in related businesses and increasing conflicts among managers with distinct compensation packages.