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How do board and chief executive characteristics influence executive compensation in non-profit organizations? The case of UK charities

Nguyen, Tam; Soobaroyen, Teerooven

Authors

TAM NGUYEN TAM.NGUYEN@NOTTINGHAM.AC.UK
Assistant Professor in Accounting

Teerooven Soobaroyen



Abstract

This paper examines the influence of trustee board composition and chief executive officer (CEO) characteristics on the CEO compensation levels in the UK charitable sector. We find that a higher extent of board diversity and the existence of a remuneration or nomination committee are positively associated with CEO compensation, while the presence of a specialist on the audit committee is negatively associated to the level of CEO compensation. In addition, the working experience of the CEO in the non-profit sector is negatively associated to compensation and the same applies to charities with a higher reliance on government funding. The findings from this study bring forward implications from the social theory of agency in explaining the factors associated to CEO compensation in the non-profit context.

Start Date Dec 1, 2017
Publication Date 2017
Pages 1-26
APA6 Citation Nguyen, T., & Soobaroyen, T. (2017). How do board and chief executive characteristics influence executive compensation in non-profit organizations? The case of UK charities
Keywords CEO compensation; governance quality; board diversity; agency theory; social theory of agency
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