Does lobbying of firms complement executive networks in determining executive compensation?

In this paper we predict and find that the lobbying activities of firms can complement executive networks in determining executive compensation. Firms of all sizes, after considering market competition as a governance mechanism, prefer to consider lobbying as a means of networking along with executi...

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Bibliographic Details
Published in:International journal of finance and economics 2021-07, Vol.26 (3), p.4137-4162
Main Authors: Nandy, Monomita, Lodh, Suman, Wang, Jin, Kaur, Jaskaran
Format: Article
Language:English
Subjects:
behavioural agency theory
Business networking
corporate lobbying
Executive compensation
executive networks
Lobbying
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Summary:In this paper we predict and find that the lobbying activities of firms can complement executive networks in determining executive compensation. Firms of all sizes, after considering market competition as a governance mechanism, prefer to consider lobbying as a means of networking along with executive level networking to determine executive compensation. The empirical implication of the study provides guidance to scholars who should consider lobbying along with executive networks in determining executive compensation. The composite theoretical underpinning and the importance of information flow through lobbying activities of firms will be an important insight for policy makers involved in determining executive compensation.
ISSN:1076-9307
1099-1158
DOI:10.1002/ijfe.2008