Compensation and Top Management Turnover

Download or read book Compensation and Top Management Turnover written by Hamid Mehran and published by . This book was released on 2008 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: An examination of CEO compensation and turnover in 452 large U.S. companies between 1984 and 1991 provides evidence that compensation policies play a significant role in retaining the services of top managers. We find inverse associations between the probability of CEO turnover and the amount by which their compensation is higher than expected. We also find inverse associations between the probability of CEO turnover and the dollar value of stock option compensation in relation to cash pay. The results, which are significant across the entire sample of CEOs, appear stronger for subsamples of CEO departures likely to have been voluntary.