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Say‐on‐pay judgements: the two‐strikes rule and the pay‐performance link
Author(s) -
Liang Yimeng,
Moroney Robyn,
Rankin Michaela
Publication year - 2020
Publication title -
accounting and finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.645
H-Index - 49
eISSN - 1467-629X
pISSN - 0810-5391
DOI - 10.1111/acfi.12391
Subject(s) - remuneration , shareholder , link (geometry) , voting , business , accounting , economics , corporate governance , finance , political science , computer science , law , computer network , politics
We undertake an experiment to explore shareholder voting behaviour when the pay‐performance link is weak or strong; and when there has (has not) been a first strike in the preceding year. We find shareholders are more supportive of a remuneration package evidencing a strong pay‐performance link than a weak link. Further, shareholders are less supportive of a remuneration package when there has been a first strike in the preceding year than when there has not been a first strike. Importantly, we find that a first strike reduces the effect of the pay‐performance link on voting intentions.