TY - JOUR
T1 - Board size, director compensation, and firm transition across stock exchanges
T2 - evidence from Canada
AU - Chowdhury, Shamsud D.
AU - Wang, Eric Zengxiang
N1 - Publisher Copyright:
© 2019, Springer Science+Business Media, LLC, part of Springer Nature.
PY - 2020/9/1
Y1 - 2020/9/1
N2 - In this study, we examine the relationship between the role and compensation structure of non-executive directors when firms on the TSX Venture Exchange (TSX-V) move to the Toronto Stock Exchange (TSX-C) in Canada. Using data from 156 listed firms, we find that graduating TSX-V firms employ relatively larger number of nonexecutive directors and pay them a higher proportion of contingent compensation than do the TSX-C firms. The graduated firms also provide non-executive outside directors with more components of compensation package. However, we find no support for the hypothesis that a TSX-V firm would pay a higher average director compensation in order to graduate. We also find that increases in the total amount and the components of compensation package are consistent with the shift in emphasis from resource dependence to monitoring in the same firm following its graduation from TSX-V to TSXC. The study’s implications are given.
AB - In this study, we examine the relationship between the role and compensation structure of non-executive directors when firms on the TSX Venture Exchange (TSX-V) move to the Toronto Stock Exchange (TSX-C) in Canada. Using data from 156 listed firms, we find that graduating TSX-V firms employ relatively larger number of nonexecutive directors and pay them a higher proportion of contingent compensation than do the TSX-C firms. The graduated firms also provide non-executive outside directors with more components of compensation package. However, we find no support for the hypothesis that a TSX-V firm would pay a higher average director compensation in order to graduate. We also find that increases in the total amount and the components of compensation package are consistent with the shift in emphasis from resource dependence to monitoring in the same firm following its graduation from TSX-V to TSXC. The study’s implications are given.
KW - Corporate governance
KW - Director compensation
KW - Non-executive directors
KW - Resource dependence theory
KW - Threshold firms
KW - Toronto Stock Exchange
UR - http://www.scopus.com/inward/record.url?scp=85069914466&partnerID=8YFLogxK
U2 - 10.1007/s10997-019-09481-1
DO - 10.1007/s10997-019-09481-1
M3 - Journal Article
AN - SCOPUS:85069914466
SN - 1385-3457
VL - 24
SP - 685
EP - 712
JO - Journal of Management and Governance
JF - Journal of Management and Governance
IS - 3
ER -