Title

A Canonical Correlation Analysis of CEO Compensation and Corporate Performance in the Service Industry

Document Type

Article

Publication Date

2003

Abstract

This paper attempts to examine a canonical (simultaneous) relationship between service industry CEOs' compensation and corporate performance with respect to accounting-based and market-based performance measures. In addition, this study examines the effect of firm size on compensation. The results of this study suggest that executive compensation depends simultaneously on both market-based and accounting-based performance measures. EPS, ROA, ROE and Market Rate of Return are positively associated with both cash compensation and long-term compensation. Firm size is also positively related to the long-term compensation.

Comments

Published:

Shim, Eunsup and Jooh Lee. "A Canonical Correlation Analysis of CEO Compensation and Corporate Performance in the Service Industry." Review of Accounting & Finance 2.3 (2003): 72-90.

DOI

10.1108/eb027013