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Non-Executive Directors' Remuneration: A European Banking Perspective
Jönköping University, Jönköping International Business School, JIBS, Business Administration.
Jönköping University, Jönköping International Business School, JIBS, Business Administration.
2017 (English)Independent thesis Advanced level (degree of Master (One Year)), 20 credits / 30 HE creditsStudent thesis
Abstract [en]

Purpose: While the role of the non-executive is frequently occurrent in the literature and European Commission’s recommendations, there is a lack of systematic studies conducted regarding thestructure of non-executive remuneration. The purpose of this study is to investigate the correlationbetween 30 large European banks’ performances, their board composition and remunerationcomponents in relation to the level of non-executive remuneration between 2011 and 2015.

Research design: A sample of 30 large European banks has been used for collecting data of paidremuneration to non-executive directors. To fulfil the purpose, firm’s performance in terms of ROA, board composition (total size, number of non-executives, and female directors), andremuneration components have been collected as control variables. Moreover, the controlvariables have been correlated to the paid remuneration to non-executives.

Findings: The study highlights ten remuneration components used in banks as building blocks fornon-executive remuneration. It offers insight concerning the correlation of these compensationcomponents to the non-executive remuneration level. The study found that banks using attendancefees generally had a lower level of remuneration to their non-executives than the banks using fixedfees for the separate roles of the board. Furthermore, the study found mixed correlations betweenthe level of non-executive remuneration, firm performance, and board composition.

Contribution: The study contributes to the debate of non-executive remuneration on a crosscountrybut single-industrial level, covering the banking industry in Europe. It attempts to improvethe understanding of the remuneration structure to non-executive directors, seen from a multinationalperspective.

Place, publisher, year, edition, pages
2017. , 66 p.
Keyword [en]
Banking, Board of Directors, Non-Executive Directors, Remuneration, Agency Theory, Corporate Governance
National Category
Business Administration
Identifiers
URN: urn:nbn:se:hj:diva-35750ISRN: JU-IHH-FÖA-2-20170478OAI: oai:DiVA.org:hj-35750DiVA: diva2:1105144
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Available from: 2017-06-27 Created: 2017-06-02 Last updated: 2017-06-27Bibliographically approved

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CiteExportLink to record
Permanent link

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Cite
Citation style
  • apa
  • harvard1
  • ieee
  • modern-language-association-8th-edition
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
  • sv-SE
  • Other locale
More languages
Output format
  • html
  • text
  • asciidoc
  • rtf