Executive compensation and corporate performance of energy companies around the world

Wang, Chaohui; Zhang, Su; Ullah, Subhan; Ullah, Raza; Ullah, Farid

Abstract

This paper studies the relationship between executive compensation and corporate performance of global energy companies. Data from 121 listed energy companies from 2010 to 2019 were collected for empirical analysis. The results show that in the energy industry, executive compensation has a significant positive impact on corporate performance, which is consistent with agency theory, tournament theory and social network theory. In addition, we found that cash incentives are more useful than equity incentives for senior executives. Therefore, we recommend that energy companies establish a reasonable compensation incentive system to address agency issues in the sector.

• Journal Article Type: Article
• Acceptance Date: Oct 29, 2021
• Online Publication Date: Nov 27, 2021
• Publication Date: 2021-11
• Deposit Date: Dec 6, 2021
• Publicly Available Date: Dec 15, 2021
• Journal: Energy Strategy Reviews
• Print ISSN: 2211-467X
• Publisher: Elsevier BV
• Peer Reviewed: Peer Reviewed
• Volume: 38
• Article Number: 100749
• DOI: https://doi.org/10.1016/j.esr.2021.100749
• Keywords: Energy (miscellaneous)
• Public URL: https://nottingham-repository.worktribe.com/output/6908830
• Publisher URL: https://www.sciencedirect.com/science/article/pii/S2211467X21001346
• Additional Information: This article is maintained by: Elsevier; Article Title: Executive compensation and corporate performance of energy companies around the world; Journal Title: Energy Strategy Reviews; CrossRef DOI link to publisher maintained version: https://doi.org/10.1016/j.esr.2021.100749