Compensation committee presence and their effect on CEO salaries : Measuring the impact of compensation committees in firms listed on Oslo Stock Exchange and Oslo Axess

Abstract

Master's thesis Business Administration BE501 - University of Agder 2017This thesis explores the relationship between compensation committee presence and chief executive officer salaries in firms listed on Oslo Stock Exchange and Oslo Axess. Using a self-collected, unbalanced panel data sample consisting of 76 companies spanning from 2007 to 2015, we have gathered observations of CEO salaries and compensation committee presence. We have applied standard econometric methods to measure the e↵ect of compensation committees and incentive-based salaries. Our results suggest that firm size and owner concentration are more likely to impact proportion of incentive-based salary than compensation committee presence. Moreover, larger companies are found to be more likely to have implemented compensation committees. We find that the proportion of incentive-based pay has a significant positive impact on the size of CEO remuneration, while we find partial support for an e↵ect of compensation committees presence on the size of CEO pay