RIEB Seminar
TJAR Research Workshop
TJAR Research Workshop
(Hosted by TJAR Workshop, Jointly Supported by RIEB Seminar / Grant-in-Aid for Scientific Research (C) #23K01671)
| Date & Time | Saturday, November 11, 2023, 15:30 - 17:00 |
|---|---|
| Place | Meeting Room at RIEB (Annex, 2nd Floor) |
| Intended Audience | Faculty, Graduate Students, and People with Equivalent Knowledge |
| Langage | English |
| Registration | Registration is required. The seminar details will be sent to the registered emails. Registration Form (Due: Nov 8) |
15:30 - 17:00
- Topic
- The Governance of Director Compensation
- Speaker
- Sterling HUANG (School of Accountancy, Singapore Management University)
- Abstract
- The average total compensation of directors in U.S. listed companies was $450,680 in 2020, 6.67 times the median household income. Directors set their own pay, giving rise to potential self-dealing. We argue and document that in the presence of self-dealing, external mechanisms such as legal standards act as effective means of governance. Following a landmark Delaware court ruling that subjected director pay to a more stringent legal standard, Delaware-incorporated firms reduced director compensation relative to non-Delaware firms and experienced positive and non-transient stock price reactions. Our results indicate that proper governance of director compensation enhances firm value.