| Escaping the institutional iron cage: Competing institutional logics and CEO compensation of state owned enterprises |
Received:October 15, 2017 Revised:October 15, 2017 |
Key Words: CEO compensation; overseas listing; institutional logics; state logic; market logic; political career concerns |
| Author Name | Affiliation | | Weiwen Li* | Sun Yat-sen University | | Shanshan Lin | Sun Yat-sen University | | Xinchun Li | Sun Yat-sen University | | Jiaqi Liu | Sun Yat-sen University |
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Abstract: |
| Chief executive officers (CEOs) of state owned enterprises (SOEs) in transition countries are often expected to receive a low level of compensation in line with the domestic state logic. These CEOs, however, are motivated to seek a high level of compensation, since their counterparts in non-SOEs are compensated much more generously. Drawing on the institutional logics perspective, this study proposes that SOE CEOs can leverage institutional logics prevalent in another society to advance their personal interests. With data on listed Chinese SOEs in domestic and overseas stock exchanges, we found that, CEOs of SOEs listed in overseas stock exchanges are more likely to get a pay raise after initial public offering than those of domestically listed SOEs. Moreover, the impact of overseas listing is weaker for CEOs with political experience and young CEOs, who may prioritize their political career advancement over financial wealth, and stronger for firms with high foreign ownership and high ratio of foreign directors on boards of directors, in which the CEOs can further justify the pay raise by citing powerful constituents supporting the market institutional logic. |
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