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Directors in Banks: Compensation and Characteristics

  • Lisa Goh
  • Aditi Gupta
Chapter

Abstract

Banks are frequently excluded from studies on executive compensation and corporate governance even though they play a critical role in the economy. In this chapter, we examine whether and how compensation of CEOs and board members in UK banks differs from compensation practices in other firms, using a sample of UK banks, FTSE 100, and matched-sample firms. We also examine differences in individual characteristics of both executive and non-executive board members of banks and those in other firms. We find that, contrary to public perception, CEOs in banks receive lower total compensation than CEOs of other firms. However, their compensation packages are weighted significantly more towards short-term compensation than in other firms. We also find that non-executives in banks are more highly paid than those in other firms.

Keywords

Corporate Governance Chief Executive Officer Stock Option Executive Compensation Control Firm 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer-Verlag Berlin Heidelberg 2012

Authors and Affiliations

  1. 1.Department of AccountingLondon School of Economics and Political ScienceLondonUK
  2. 2.Department of ManagementKing’s College LondonLondonUK

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