Executives Compensation and Performance in Family and Non-Family Brazilian Companies
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Abstract
Objective: in order to produce new insights for the knowledge about the effects of executive compensation on companies, relationship between performance (short-term) and investment policy (long-term) in Brazilian family and non-family companies listed in Brazil, Bolsa, Balcão (B3) are investigated. Methods: documentary procedure research was conducted with data from Economática® and company reports (Management Report, Reference Form and Explanatory Notes). The sample of 87 companies consists of 48 family and 39 non-family companies. Results: indicate that the short-term variable remuneration is related to the performance and investment policy of the companies, while the long-term variable remuneration was not significant. Short-term variable compensation reveals potential to maximize corporate performance, with a stronger impact on non-family companies. In view of the investment policy, short-term variable compensation presents a negative relation, but this effect is reverted to non-family companies. Conclusion: executive compensation can be a governance mechanism to align the interests of the parties, both in family and non-family companies. However, its precise dimensioning must consider the type of ownership and corporate management.
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