Crawford, Steve
[VerfasserIn]
;
Nelson, Karen K.
[Sonstige Person, Familie und Körperschaft];
Rountree, Brian
[Sonstige Person, Familie und Körperschaft]
Mind the Gap
: CEO-Employee Pay Ratios and Shareholder Say-on-Pay Votes
Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments March 19, 2020 erstellt
Beschreibung:
We examine the Securities and Exchange Commission's assertion in the Pay Ratio Disclosure rule that the ratio of CEO to employee pay is useful to shareholders for say-on-pay (SOP) voting decisions. Using an estimated pay ratio for a broad panel of commercial banks from 2010-2017, we find that voting dissent on SOP proposals is significantly higher in the top pay ratio decile, particularly when institutional ownership is high. Results are robust to controlling for a number of other determinants of voting dissent, including proxy advisor recommendations and executive compensation. Additionally, inferences using the first year of disclosed pay ratios in 2017 for S&P 1500 firms are consistent. However, we do not find similar results in the other deciles of the pay ratio in either sample, calling into question whether a cost-benefit analysis would support the disclosure requirement imposed by Dodd-Frank and implemented by the SEC