CEO compensation and board structure

Vidhi Chhaochharia, Yaniv Grinstein

Research output: Contribution to journalArticlepeer-review

253 Scopus citations


In response to corporate scandals in 2001 and 2002, major U.S. stock exchanges issued new board requirements to enhance board oversight. We find a significant decrease in CEO compensation for firms that were more affected by these requirements, compared with firms that were less affected, taking into account unobservable firm effects, time-varying industry effects, size, and performance. The decrease in compensation is particularly pronounced in the subset of affected firms with no outside blockholder on the board and in affected firms with low concentration of institutional investors. Our results suggest that the new board requirements affected CEO compensation decisions.

Original languageEnglish (US)
Pages (from-to)231-261
Number of pages31
JournalJournal of Finance
Issue number1
StatePublished - Feb 1 2009

ASJC Scopus subject areas

  • Accounting
  • Finance
  • Economics and Econometrics


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