Association between key management personnel remuneration and the performance of Authorized Deposit-Taking Institutions in Australia

Xue Li, Rahat Munir, Alan Kilgore

Research output: Contribution to journalArticle

Abstract

The study investigates the association between each component of key management personnel remuneration (short-term and long-term remuneration) and total remuneration, and the performance of Authorized Deposit-taking Institutions (ADIs) in Australia. Data were collected from 91ADIs regulated by the Australian Prudential Regulation Authority. The study provides evidence that total key management personnel remuneration, short-term key management personnel remuneration and long-term key management personnel remuneration are significantly associated with the performance of ADIs, while the pay-performance association is weaker for long-term remuneration as compared to total remuneration and short-term remuneration. In addition, size of the board, existence of remuneration board committee and composition of remuneration board committee is significantly associated and composition of the board is partially associated with the performance of ADIs in Australia. The findings of the study also suggest that the pay-performance association is more sensitive for short-term remuneration as compared to long-term remuneration, indicating that although long-term remuneration is widely used by ADIs, short-term remuneration is an important part of key management personnel remuneration.
Original languageEnglish
Pages (from-to)123-160
Number of pages38
JournalInternational journal of accounting and financial reporting
Volume5
Issue number1
DOIs
Publication statusPublished - 2015

Keywords

  • Key management personnel remuneration
  • base salary
  • short-term bonus
  • long-term incentives
  • corporate performance

Fingerprint Dive into the research topics of 'Association between key management personnel remuneration and the performance of Authorized Deposit-Taking Institutions in Australia'. Together they form a unique fingerprint.

Cite this