Impact of Firm Performance, Multi-Nationality, and Innovation in MNCs.

摘要

This study examined the role of firm performance, internationality, innovation intensity and firm size in determining CEO executive compensation in multinational enterprises. The framework for this study was established by reviewing literature relevant in executive compensation, agency theory, internationalization, innovation, contingency, and resource based theories. The sample data of 1,950 observations from 488 companies over a period of four years (2008-2011) were collected from ExecuComp database and from Forbes Global 2000 companies list published in 2011. A quantitative methodological approach using correlational research design was employed. The results indicated a positive relation between executive compensation paid to CEOs and firm performance measured in return on assets and return on equity, and size of the firm. Results did not indicate a strong relation between executive compensation paid to CEOs and internationalization and, investment in research and development in multinational corporations. Empirical analyses derived from the data set of this study failed to provide adequate evidence to support the expected moderating effect of firm size on executive compensation paid to CEOs and firm performance. A large part of executive compensation paid to CEO remains unexplained in part due to the need for a greater understanding of the effects of the contextual variables related to internationalization, innovation intensity, and understanding the impact differences from short term and long term executive compensation structures. This dissertation contributes to the literature on compensation, MNC analysis, and innovation.