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This paper is an investigation of the pay-for-performance link in executive compensation. In particular, we document main issues in the pay–performance debate and explain practical issues in setting pay as well as data issues including how pay is disclosed and how that has changed over time. We also provide a summary of the state of CEO pay levels and pay mix in 2009 using a sample of over 2,000 companies and describe main data sources for researchers. We also investigate what we believe to be at the root of fundamental confusion in the literature across disciplines – methodological issues. In exploring methodological issues, we focus on empirical specifications, causality, fixed-effects, first-differencing, and instrumental variable issues. We then discuss two important but not yet well-explored areas, international issues, and compensation in non-profits. We conclude by examining a series of research areas where further work can be done, within and across disciplines.

M. Ronald Buckley holds the JC Penney Company Chair of Business Leadership and is a professor of management and a professor of psychology in the Michael F. Price College of Business at the University of Oklahoma. He earned his Ph.D. in industrial/organizational psychology from Auburn University. His research interests include, among others, work motivation, racial and gender issues in performance evaluation, business ethics, interview issues, and organizational socialization. His work has been published in journals such as the Academy of Management Review, Personnel Psychology, Journal of Applied Psychology, Organizational Behavior and Human Decision Processes, and the Journal of Management.

MISS ANNE SHAW's presence on the platform at the annual general meeting of the Management Consultants Association was a solid assurance that work study still lies within its scope. The initial impression was weakened, however, when the chairman, Mr. D. J. Nicolson, mentioned that the bulk of consultancy work was no longer concerned with work study. Instead, it gave more than half its attention to policymaking and the broad aspects of organising financial, manufacturing and marketing resources.