Journal article
Career Concerns, Contract Choice, and “Unpaid” Executives
H Chen, W Luo, N Soderstrom
Journal of Management Accounting Research | AMER ACCOUNTING ASSOC | Published : 2023
Abstract
We examine a unique setting of publicly listed Chinese state-owned enterprises (SOEs), where some top executives are paid by government-controlled parent firms rather than by the firms where these executives work. Because their reported compensation is zero, these executives have been ignored in the literature. We find that the CEOs’ own personal characteristics, the nature of the CEO’s job responsibilities, and the environment in which the firm operates are significantly related to the CEO’s contract type. We also document that parent-paid CEOs have a significantly higher probability of future promotion than other CEOs. Compared to peer firms that directly pay their CEOs, firms with parent-..
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Awarded by National Natural Science Foundation of China
Funding Acknowledgements
We thank Maggie Abernethy, Gavin Cassar, Shane Dikolli, Fei Du (discussant) , and participants at the 2017 Colloquium on Personnel Economics, 2017 Management Accounting Section Midyear Meeting, 2017 European Accounting Association Annual Congress, and 2017 Tel Aviv Accounting Conference and in workshops at Bocconi University, ESSEC Business School, Nanyang Technological University, the University of Western Australia, and Wuhan University for discussions and comments. Wei Luo acknowledges financial support from a National Natural Science Foundation of China grant (Project No.71272035) .