The remuneration (or pay) of CEOs and other senior managers has risen much faster than that of the workers who deliver on corporate performance requirements. In 1970, the average CEO made over 30 times the average production worker, by 2008 this had increased to a factor of 325. Despite the global financial crisis, by 2015 the multiple had risen to 335. The problems created or worsened by this phenomenon are many - from market failure, through CEO enrichment at the expense of shareholders to the breakdown in trust between management and workforce. This represents an important, but complex, area of research which can be difficult to traverse.
This shortform book provides a research map for scholars looking to investigate the thorny issue of executive pay. The author, an expert scholar and practitioner, provides time-saving summaries of how executive pay is set in practice; the role of legislation; and a thorough digest of the key theories involved - including agency, power and behavioural theories.
With the inclusion of an expert survey of existing literature, this small book is a gold mine for new researchers to this vital area of interest.
Ruth Bender is Professor of Corporate Financial Strategy at Cranfield University, UK