Abstract
This study researches the influences of CEO compensation on firm behavior to examine the interactive relationship between the behavioral momentum of innovation in R&D and CEO compensation. The models presented in this study are based on evolutionary, institutional, and agency theories to test hypotheses using data from 107 companies in the high-technology sectors in the United States. The results indicate that the pre-succession innovative behavior of these high-technology firms on R&D can positively affect these firms' post-succession innovative behavior towards R&D. That is, positive momentum in R&D innovation prevails in a firm across a change of the CEO. However, for the role of CEO compensation, short- and long-term compensation does not positively moderate this behavioral momentum in R&D. Hence, the moderating impact of short- and long-term CEO compensation to enhance the momentum of innovation in R&D can be romanticized. These findings provide boards of directors with evidence as to how a CEO succession matters to a firm's behavioral momentum in R&D, and whether CEO compensation can be strategized to change a firm's innovation and momentous behavior.
| Original language | English |
|---|---|
| Pages (from-to) | 2763-2784 |
| Number of pages | 22 |
| Journal | International Journal of Human Resource Management |
| Volume | 23 |
| Issue number | 13 |
| DOIs | |
| Publication status | Published - 2012 Jul |
Keywords
- CEO compensation
- agency theory
- evolutionary theory
- innovation
- institutional theory
- momentum
ASJC Scopus subject areas
- Industrial relations
- Management of Technology and Innovation
- Business and International Management
- Organizational Behavior and Human Resource Management
- Strategy and Management
