Do Board-Level Employee Representatives Increase Pay Equity in Firms?

IF 4.6 3区管理学 Q1 BUSINESS

Corporate Governance-An International Review Pub Date : 2024-09-24 DOI:10.1111/corg.12608

Amirhossein Fard, Chune Young Chung

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引用次数: 0

Abstract

Question/Issue

This study investigates the role of board-level employee representatives (BLERs), a common corporate governance practice in Europe, in determining the pay ratio between CEOs and average employees.

Research Findings/Insights

Using 15,340 firm-year observations from 17 European countries between 2001 and 2019, we find that BLERs provide greater bargaining power to the board for dealing with CEOs and use this power to reduce the pay gap between CEOs and employees. Subsample analyses indicate that bargaining power is more apparent when BLERs are more socially connected, have longer tenure, and hold more seats on the board.

Theoretical/Academic Implications

This study supports the role of BLERs in providing workers with more bargaining power to create fairer wage distribution in firms. Furthermore, it supports the fair wage–effort theory, indicating a positive effect of lower pay ratios on firm value following the presence of BLERs.

Practitioner/Policy Implications

This study demonstrates the effects of a unique corporate governance practice, the presence of BLERs, on companies' wage distribution, with significant policy implications. In particular, the results indicate that when presented with opportunities in affecting companies decision-making BLERs provide fairer environments for the workers who they represent.

查看原文本刊更多论文

董事会级别的员工代表是否能提高公司的薪酬公平性？

问题本研究调查了董事会层面的员工代表（BLERs）在决定首席执行官与普通员工之间薪酬比例方面的作用，这是欧洲常见的公司治理做法。研究结果/见解利用 2001 年至 2019 年期间 17 个欧洲国家的 15,340 个公司年度观察结果，我们发现，BLER 为董事会与首席执行官打交道提供了更大的议价权，并利用这种权力缩小了首席执行官与员工之间的薪酬差距。子样本分析表明，当BLER的社会关系更密切、任期更长、在董事会中占有更多席位时，议价能力会更加明显。理论/学术启示本研究支持企业劳动雇佣关系法的作用，即为工人提供更多的讨价还价能力，从而在企业中创造更公平的工资分配。此外，它还支持公平工资-努力理论，表明在存在 BLER 后，较低的工资比率对公司价值有积极影响。实践者/政策启示本研究展示了一种独特的公司治理实践--存在劳动基准与报酬关系--对公司工资分配的影响，具有重要的政策启示。特别是，研究结果表明，当有机会影响公司决策时，BLER 为其所代表的工人提供了更公平的环境。

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

Corporate Governance-An International Review Multiple-

CiteScore

7.00

自引率

11.30%

发文量

期刊介绍： The mission of Corporate Governance: An International Review is to publish cutting-edge international business research on the phenomena of comparative corporate governance throughout the global economy. Our ultimate goal is a rigorous and relevant global theory of corporate governance. We define corporate governance broadly as the exercise of power over corporate entities so as to increase the value provided to the organization"s various stakeholders, as well as making those stakeholders accountable for acting responsibly with regard to the protection, generation, and distribution of wealth invested in the firm. Because of this broad conceptualization, a wide variety of academic disciplines can contribute to our understanding.