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Case Studies of Executive Compensation in Agricultural Cooperatives
Author(s) -
Trechter David D.,
King Robert P.,
Cobia David W.,
Hartell Jason G.
Publication year - 1997
Publication title -
applied economic perspectives and policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.4
H-Index - 49
eISSN - 2040-5804
pISSN - 2040-5790
DOI - 10.2307/1349756
Subject(s) - executive compensation , agriculture , compensation (psychology) , business , accounting , economics , agricultural economics , finance , corporate governance , geography , psychology , archaeology , psychoanalysis
Few factors are more important for a cooperative's success than the manager. However, structuring a manager's compensation package to deal with principal‐agent problems is a challenge for cooperatives. Conceptually, this problem could be addressed with ex ante incentive clauses that would signal the board's preferences to the manager. The five case studies in this paper examine compensation and evaluation methods for managers of successful local supply and marketing cooperatives. These cases suggest a reluctance to use ex ante incentives to ensure performance.