The impact of the high technology crisis on CEO compensation

The paper empirically examines CEO compensation in 125 UK high technology firms in an attempt to identify and understand any changes in the pay system evident after the global technology market correction in 2000. We find evidence that link between executive pay and market returns weakened and that the fixed component of executive pay in these companies rose post-adjustment. These changes appear to compensate executives for the increased risk associated with variable pay rather than rectify any perceived problems with executive incentives pre-2000

Facets of job satisfaction and work engagement

This study analyzes the relationship between the the facets of job satisfaction and the work engagement. Previous studies that focus on the linkages between work engagement and overall job satisfaction ignore the multi-faceted nature of job satisfaction construct. In this study, how job satisfaction facets are linked to three dimensions of work engagement - i.e. vigor, dedication and absorption- is discussed by drawing on the Social Exchange Theory. The cross-lagged data used in this study comes from the specialist lending division of a UK bank. The Linear Multiple Regression analyzes are run to test the proposed theoretical model. The results show that among all the job satisfaction facets, the ‘satisfaction with work itself’ is the key driver of all dimensions of work engagement i.e. vigor, dedication and absorption. The ‘satisfaction with conditions’ is negatively linked to absorption of employees in their work. This means that the employees with high workload might not be absorbed in their work. Finally, it is found that employees who are satisfied with the communication in their work are also absorbed in their work. This study contributes to our knowledge of the drivers of work engagement over time. The facets of job satisfaction as the drivers help us to have a comprehensive understanding of the link between the job satisfaction facets and work engagement. This study first contributes to the work engagement literature which has neglected the multi-dimensional approach of job satisfaction. This study also contributes to the limited number of work engagement studies conducted in service sector and in UK

Corporate social performance and the psychological contract

This study investigates the role of corporate social performance (CSP) within the psychological contract to better illuminate the micro-processes through which CSP promotes improved firm–stakeholder relationships. It extends the study of psychological contract breach beyond the dyadic relationship between the organization and the employee through an analysis of the impact of employee perceptions of internal and external CSP on psychological contract breach. In so doing, we add significantly to the growing evidence base in relation to if, how, and when affective commitment is enhanced by CSP by explicitly accounting for the role of employee expectations in respect of their employers’ socially responsible initiatives in shaping employees’ attitudinal outcomes.25 page(s

Are CEOs the Only Residual Claimants? Estimation of the Performance Elasticity of Per-Employee Compensation

This paper evaluates the intensity of the value-maximization incentives for average employees generated through wage, salary, and bonus mechanisms. This is accomplished through estimation of the elasticity of average employee hourly compensation with respect to changes in firm performance. This performance elasticity indicates the degree of alignment between employee and shareholder objectives, and it can also be interpreted as a residual income claim for employees. The estimated performance elasticity for the full sample of firms is indistinguishable from a CEO performance elasticity of 0.1 published in Coughlan and Schmidt (1985). The estimated performance elasticity is 0.152 in small firms and indistinguishable from zero in large firms. While CEO rewards are larger than the rewards of average employees in absolute terms, these rewards represent comparable fractions of income for both the CEO and the average employee. Firms use wage, salary and bonus adjustments to direct approximately 4.1 percent of firm value increases to employees. These results indicate that average employees hold a significant stake in firm performance.incentives, agency costs, pay-performance sensitivities, profit-sharing