Managerial compensation

M. Goergen, L.D.R. Renneboog

Research output: Contribution to journalArticleScientificpeer-review

80 Citations (Scopus)


We review the existing literature on managerial compensation, with particular reference to the two contrasting views about its main driver. On the one hand, managerial compensation is seen to be the result of a market-based mechanism which ensures that managers have adequate incentives to maximize shareholder value. On the other hand, it is regarded to be a means whereby self-serving executives skim corporate profits and expropriate shareholders. We find that most of the existing literature supports the latter view as executives tend to benefit from windfall earnings and are able to extract rents in the presence of weak corporate governance.
Original languageEnglish
Pages (from-to)1068-1077
JournalJournal of Corporate Finance
Issue number4
Publication statusPublished - 2011


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