The Impact of Institutional Ownership on CEO Compensation among the NBFIs: Bangladesh Perspective
Abstract
The connection between institutional ownership and CEO compensation has been studied in this paper. In this context, the authors use the data of the non-bank financial institutions (NBFIs) working in Bangladesh from 2010-2019. The research finds that NBFIs with a higher institutional ownership concentration pay substantially higher CEO compensation than comparable NBFIs. The results are robust to the multifaceted fixed effects regression and alternative measurement models. The results further show that pay premiums are attributable to the ownership concentration and agency theory. Institutional owners prefer to avoid agency problems through rewarding higher CEO compensation.
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References
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