Relationship between CEO salaries and performance of banks in Australia and Germany

Preißing, Dagmar, Southey, Gregory, & Laing, Gregory (2013) Relationship between CEO salaries and performance of banks in Australia and Germany. e-Journal of Social & Behavioural Research in Business, 4(1), pp. 12-19.

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Purpose: The purpose of this paper was to examine the relationship between CEO salaries and firm performance in the banking sector. Design/methodology/approach: The data relating to a six year period (2007 - 2012) was gathered from databases and the websites of the major banks in Australia and Germany. The data was subjected to Regression and Pearson Correlation Analysis to test if there was a positive correlation between total salary including incentive bonuses against the variables indicating the performance of the firm. Findings: The tests indicate a weak relationship between the CEO salary package and the key indicators of a firm's performance in Australian banks but a strong relationship in the German banks. Research limitations/implications: This study was limited in that it only covers the major banks in Australia and Germany and may therefore not be relevant to different countries with different economic climates. Practical implications: This study provides additional evidence to support the continued debate regarding the need to have greater accountability for CEO salary packages linked to actual performance measures of firms. Originality/value: This paper adds to the literature in so far as it compares two different Countries of the banking sector in a global market

Impact and interest:

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ID Code: 63380
Item Type: Journal Article
Refereed: No
Keywords: CEO Salary Packages, Banking Sector, Firm Performance Measures
ISSN: 1838-8485
Subjects: Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > BUSINESS AND MANAGEMENT (150300) > Organisational Behaviour (150311)
Divisions: Current > QUT Faculties and Divisions > QUT Business School
Current > Schools > School of Management
Deposited On: 16 Oct 2013 03:25
Last Modified: 17 Oct 2013 21:26

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