Paper
Determinants of Supervisory Board Compensation in Germany
- Authors:
- Georg Stadtmann; Rosemarie Koch
- Abstract
- We analyze supervisory board compensation for German DAX 30 firms in the years 2007 and 2008. The main focus is an econometric analysis of the determinants of supervisory board compensation. As opposed to the majority of previous research on this topic, we analyze supervisory board compensation on a person level which permits us to include specific individual determinants. We find that supervisory board compensation is positively dependent on the involvement in special functions such as chairmanship, deputy chairmanship or involvement in the boards committees as suggested by the German Corporate Governance Code. Other personal specific factors which are not related to functions and roles on the board do not have a statistically significant influence on compensation when controlling for the right firm factors. These variables are for example gender, holding a PhD title, number of other mandates on boards, being an employee representative and previous or current experience on management boards. Thus, these factors do not lead to differences in compensation and we do not find evidence that the non-discrimination precept is violated. Interestingly, some model specifications suggest that female board members earn significantly less than male board members. However, when controlling for the female share of supervisory board members as a firm influence, the influence of female board members drops out. The fact why a high share of female supervisory board members is connected to significantly lower pay of supervisory board members on that board needs further research.
- Keywords
- Executive Compensation; Supervisory Board; Determinants; Soft Regulation
- StartPage
- 56
- EndPage
- 67
- Doi