The results obtained from this research indicates that there is no statistical relation between the chosen financial variables and the total compensation to the CEO, except sales.

CEO compensation is a highly debated subject in Sweden. The debate concerns whether or not CEOs are paid too much in relation to their results. This research investigates what decides the CEO compensation. Can the CEO compensation be explained by the financial variables ROA, ROE, Sales, Tobin’s q, and the size of the largest shareholder?

In this paper companies listed on the Swedish Stock Exchange OMX Stockholm large and mid cap during the years 2003 to 2008 are analyzed by empirically and theoretically adapted models.