An analysis of corporate board compensations in the Portuguese energy sector

Abstract

Purpose

The aim of this paper is to investigate how the corporate board compensations as a whole, must be perceived as fair and not directly related to the short‐term results, thus avoiding embarrassment and misunderstanding.

Design/methodology/approach

The study analyzed the theoretical issues associated with the question of corporate board compensation and developed a research applied to two companies in the Portuguese energy sector, listed on stock exchanges.

Findings

The findings reveal that total remuneration paid to board of directors is in line with the values involved in the business, which is not always well perceived by Society.

Practical implications

The Portuguese energy sector is based on a concentrated market structure. The boards of the companies seem to be composed of independent directors, their pay systems consisting of a fixed and a variable component; this seems supported by a capitalist logic of value creation for shareholders.

Originality/value

This is the first time that corporate board compensations have been publicly revealed. The analysis of systems of remuneration of directors is made using the public information provided by the respective companies in the year 2009. The total remuneration is compared with the size of their respective companies.

Citation

Rodrigues, J. and Seabra, M. (2012), "An analysis of corporate board compensations in the Portuguese energy sector", Management of Environmental Quality, Vol. 23 No. 1, pp. 56-67. https://doi.org/10.1108/14777831211191593