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This study aims to examine whether chief executive officer (CEO) pay-performance sensitivity to shareholder wealth is related to the use of non-financial performance measures in incentive contracts.

Using hand-collected performance measure data in a sample of S&P 500 firms across the period 1994–2010, this study investigates the sensitivity of CEO bonus and cash pay to shareholder wealth of firms that use non-financial performance (NFPM) measures of varying types and contractual weights in their bonus contracts along with financial measures (NFPM firms) in comparison to that of firms using financial measures only (FPM firms).

This study finds evidence that the pay-performance sensitivity is stronger in NFPM firms than in FPM firms. These results are driven by the use of CEO individual goals and operational efficiency. Furthermore, when using environmental, social and governance factors, the pay-performance sensitivity is stronger in terms of accounting performance only. This study also finds that using NFPM enhances pay-performance sensitivity more as their contractual weights increase and as financial risk increases.

These findings are important to stakeholders, and especially regulators in understanding incentive effects of alternative performance measures. This study also sheds light on what types of non-financial measures are better in helping firms align CEOs’ incentives to shareholders’ interests.

This study contributes to prior research on benefits of non-financial information within the context of executive compensation. This study presents original results about the effects of contractual weights of non-financial measures and financial risk on CEO pay-performance sensitivity. This study also presents new insights regarding how different types of non-financial measures affect CEO pay-performance sensitivity.

The purpose of this paper is to use tenets of the complexity theory in order to study the effect of various determinants of firm’s performance, such as CEO’s compensation and age, for the case of 72 insurance companies.

The authors identify the asymmetries in the data set by creating quantiles and using contrarian analysis. Instead of ignoring this information and use a main effects approach, all the available information in the data set is taken into account. For this purpose, the authors use qualitative comparative analysis to find alternative equifinal routes toward high firm performance.

Five configurations are found which lead to high performance. Every one of the five configurations is found to be sufficient but not necessary for high firm performance.

The research findings contribute to a better understanding of the determinants of firm’s performance taking into account the asymmetries in the data set. The authors identify alternative paths toward high firm performance, which could be vital information for the decision maker inside a firm.

The article investigates the patterns of asset impairment recognition in search of signs of “big bath” earnings management practices across an internationally diversified sample of public companies. It also elucidates the incentives that may underlie such practices and explores possible safeguards embedded in the existing corporate governance mechanisms.

The article applied static panel and binary logit models to an international firm-level panel dataset of 1045 public companies observed between 2003 and 2018.

Our empirical results suggest that recognition of asset impairment has no determinate impact on earnings volatility. Investigating the possibility of “big bath” earnings management practices, the authors found no impact of asset impairment recognition on total senior executive compensation in firms, which pay performance-based remuneration. The quality of corporate governance has appeared to impact the firms’ intertemporal proclivity to recognize asset impairment with those having the more entrenched and management-controlled boards being more likely to time impairment recognition by delaying it during exceptionally good and exceptionally bad years. While generally unlikely, recognition of asset impairment in a period with a recorded negative operating performance is found to be closely associated with key executive departures.

The article corroborates the salient role of corporate governance mechanisms in shaping the intertemporal patterns of asset impairment recognition. The possible remedies to the phenomenon should be derived therefrom.

Companies around the globe increasingly receive immense shareholder scrutiny due to perceivably excessive executive director remuneration. The debate in South Africa intensifies due to severe pay inequality. The authors thus accounted for the perspectives of asset managers and listed financial services companies in South Africa pertaining to the impact of voting and engagement on director pay policies and practices.

Semi-structured interviews were conducted with selected asset managers, chief executive officers, chief financial officers and remuneration committee members of listed financial services companies to gauge their views on the impact of shareholder activism endeavours on remuneration governance. The qualitative data was analysed by conducting thematic analysis.

Most of the asset managers and financial services representatives preferred proactive, private engagement on pay concerns, given the impact thereof on voting outcomes, and ultimately director remuneration practices and policies. Independent remuneration committees have a prominent role in facilitating engagements with investors to ensure fair remuneration.

The consequences should be clearer if organisations receive substantial votes against their pay policies and implementation reports. South African regulators can consider the “two-strikes” rule to ensure that action is taken in response to shareholder voting on director remuneration matters.

Representatives of asset managers and listed financial services investee companies offered valuable insights on remuneration governance deliberations in an emerging market. This in-depth analysis highlights the importance of proactive engagement to ensure that corporate leaders are paid fairly.

The aim of this paper is to show the ways of setting quality objectives, their attributes and the conditions under which they can perform a motivational function.

Collecting relevant data, the authors used the results of previous research and theoretical assumptions concerning quality objectives. Subsequently, they carried out a survey and exemplification research based on participatory observations, document content analysis and interviews.

Goals are set mainly by top management, but the communication process itself is insufficient; the needs of system users are not taken into account. In the opinion of the employees, quality objectives are measurable and objective, although not very ambitious. For quality objectives to fulfil a motivational function, they should be objective and measurable. Also, the allocation of tasks among employees needs to be fair. Furthermore, quality objectives have to play a greater role in remuneration systems.

This paper is one of the first publications on the role and function of quality objectives. Its advantage is that it defines the conditions under which such objectives can have a motivational effect and encourage employees to pursue the improvement of their products and services.

This paper reviews the literature on zombie firms to provide a holistic view by delineating their formation, impact, widespread nature, prevention and policy implications.

This paper uses a systematic literature review methodology, in which 76 papers published in journals ranked on the Australian Business Deans Council (ABDC) 2022 list were reviewed. The study period was from 2000 to 2022.

Among the main findings, the widespread problems of zombie firms were evident. The authors found that consistent support, either in the form of government grants or a weak financial framework, was responsible for their formation. The suboptimal performance of factors of production, depressed job creation, low innovation and overall negative impact on economic activity are the consequences of zombification. This can be controlled by ensuring better bankruptcy codes, focused on government assistance, technology use and better due diligence by banks.

This review serves as a reference point for future researchers as a cohesive and holistic study presenting a full picture of the problem, so that the proposed solutions are robust and tenable.

This review is among the initial attempts to comprehensively study published work on zombie firms in terms of analyzing their region-specific nature, with an emphasis on definition, causes, impact and prevention.

Performance-based contracting (PBC) plays an increasingly important role in the defense industry. This paper aims to investigate factors that influence service provider’s willingness to accept PBC-induced risks. It also shows how these risks could be managed in a military service supply chain.

The case study focused on the relationship between a service provider and a customer that acted on behalf of other users in the defense sector. The contract involved the sustainment of a military engine in a complex supply chain.

The service provider’s performance attributability appeared to have a strong impact on its willingness to take PBC-induced risks. For the parts where the service provider did not have full control over the service performance, exclusions and Service Level Agreements (SLAs) were used to manage and mitigate the risks associated with uncontrolled performance. The service provider’s willingness to accept PBC-induced risks was also affected by its ability to make accurate forecasts, the applied growth path and the length of the contract.

This case has specific characteristics, unique by time (maturity of the technical system and supply chain) and place (market). It is recommended that results are tested in other research settings.

Organizations should be aware of the factors that influence a service provider’s willingness to bear PBC-induced risks. Customers should limit PBC to those parts of a contract where risks are of an acceptable level. Also, it is recommended to follow a phased growth path when it is not possible to make accurate forecasts in a PBC context.

This study is the first to address critical issues concerning the identification and management of risks under PBC in the defense industry.