Title: Impact of legal protection and board characteristics on CEO compensation

Authors: Hani El-Chaarani; Paola Paoloni; Zouhour El-Abiad

Addresses: Beirut Arab University (BAU), Beirut, Lebanon ' Sapienza University, Rome, Italy ' Lebanese University (LU), Beirut, Lebanon

Abstract: This study explores the impact of legal protection level and board characteristics on the structure and the pay-performance sensitivity of CEO compensation. To reach the declared goals, this paper is supported by Mann-Whitney test. Data from 12 European countries for the 2016-2018 period reveals a significant impact of the legal protection level, CEO duality, board size, board independence and the presence of efficient compensation committee have a significant impact on the structure of CEO compensation but not on the pay-performance sensitivity of CEO compensation. In addition, the results show that the presence of women on board of directors has a positive impact on CEO's compensation. Present study contributes to literature in the fields of gender study and corporate governance of the firms. Also, present research has several managerial implications, highlighting the impact of legal protection and board characteristics on CEO compensation.

Keywords: legal protection; CEO's compensation; compensation structure; pay-performance sensitivity; board of directors' characteristics.

DOI: 10.1504/IJMDM.2022.124410

International Journal of Management and Decision Making, 2022 Vol.21 No.3, pp.305 - 338

Received: 13 Jul 2021
Accepted: 19 Jul 2021
Published online: 26 Jul 2022 *

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