Does leverage influence the impact of pay gaps on performance in listed retail and mining firms? Evidence from South Africa

IF 3.2 Q1 BUSINESS, FINANCE
Nomanyano Primrose Mnyaka-Rulwa, Joseph Olorunfemi Akande
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引用次数: 0

Abstract

Purpose

Agency theory motivated this study, posing that leverage mitigates the agency problem. The aim was to examine whether leverage influences the relationship between executive-employee pay gaps (EEPGs) and firm performance. The study was conducted in the mining and retail sectors between 2012 and 2021.

Design/methodology/approach

Two EEPGs were featured based on their executive fixed pay and variable incentives accumulation. Proxies of firm performance were headline earnings per share; return on assets; earnings before interest, tax, depreciation and amortisation; and return on stock price. Data were collected from 76 JSE-listed firms in the retail and mining sectors and analysed using the two-step generalised method of moments.

Findings

The results revealed the hybrid implication of the pay gap for firm performance in the retail and mining sectors of South Africa, depending on the performance measures emphasised. More importantly, the study shows that with the moderating effects of leverage, firms can improve their performance while shrinking the pay gap.

Practical implications

The results have implications for policy addressing income inequality, debt management, executive compensation and regulatory reforms in South Africa concerning productivity and remuneration decisions.

Originality/value

The article provides specific literature for retail and mining industries on pay gaps, shows that it is possible to reduce the pay gap without compromising performance and suggests a new measure of performance that is more attuned to pay gap effect measurement.

杠杆作用是否会影响上市零售公司和矿业公司的薪酬差距对业绩的影响?来自南非的证据
目的 代理理论是本研究的动机,认为杠杆作用可以缓解代理问题。本研究旨在探讨杠杆作用是否会影响高管-员工薪酬差距(EEPGs)与公司业绩之间的关系。本研究在 2012 年至 2021 年期间对采矿业和零售业进行了研究。设计/方法/途径根据高管固定薪酬和浮动奖励的累积情况,对两种 EEPGs 进行了分析。公司业绩的代用指标包括每股净收益;资产回报率;未计利息、税项、折旧及摊销前的利润;以及股价回报率。数据收集自零售业和采矿业的 76 家 JSE 上市公司,并使用两步广义矩方法进行了分析。研究结果表明,薪酬差距对南非零售业和采矿业的公司业绩具有混合影响,具体取决于所强调的业绩衡量标准。更重要的是,该研究表明,在杠杆的调节作用下,企业可以在缩小薪酬差距的同时提高绩效。原创性/价值该文章为零售业和采矿业提供了有关薪酬差距的具体文献,表明在不影响绩效的情况下缩小薪酬差距是可能的,并提出了一种更适合薪酬差距效应衡量的新绩效衡量方法。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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来源期刊
CiteScore
5.80
自引率
13.00%
发文量
38
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