Please use this identifier to cite or link to this item: http://hdl.handle.net/10397/80846
Title: Is board of director compensation excessive in restaurant firms?
Authors: Mun, SG 
Paek, S 
Woo, L 
Park, S 
Keywords: Board of director compensation
Overcompensation
Under-compensation
Resource dependence theory
Agency theory
Restaurant firms
Issue Date: Sep-2019
Publisher: Pergamon Press
Source: International journal of hospitality management, Sept. 2019, v. 82, p. 149-158 How to cite?
Journal: International journal of hospitality management 
Abstract: This study confirms that a firm’s size in the previous year significantly increases board of director compensation in the current year, while the number of directors and the firm’s capital expenditure significantly decrease it. On average, 31.2% of restaurant firms overcompensate their board of directors, while 33.8% pay less than the expected amount of compensation to their board of directors. However, contrary to public concern, this study argues that the amounts of over- and under-compensation are negligible in proportion to the directors’ total compensation, and thus the issue of over- and under-compensation may not pose a serious problem in the restaurant industry. In particular, the amount of overcompensation has a positive effect on firm growth and capital investment, but does not substantially decrease firms’ operational and financial performance. The amount of overcompensation can even have a positive influence on financial performance, although the effect is not statistically significant.
URI: http://hdl.handle.net/10397/80846
ISSN: 0278-4319
EISSN: 1873-4693
DOI: 10.1016/j.ijhm.2019.04.014
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