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The purpose of the paper is to explore the long-run impact of board governance and bank performance on executive remuneration. More specifically, the study addresses two objectives. First, the authors investigate the long-run relationship between pay and performance hold for the Indian banking industry. Second, the authors explore the moderating role of the board in explaining the relationship between executive pay and performance.

The study uses multivariate panel co-integration approaches, i.e. fully modified and dynamic ordinary least square, to explain the co-integrating relationship between executive pay, governance and performance of Indian banks. The analysis is conducted for the period from 2005 to 2018.

The results of co-integration tests reveal a long-run relationship between executive pay, board governance and bank performance. The long-run estimates produce evidence in favour of the dynamic agency theory, suggesting that the implications of asymmetric information can be mitigated by associating the current executive pay with the bank performance in the previous periods. The finding of this study reveals that improvements in the board quality serve as a monitoring tool to constrain excessive pay and moderate the executives’ pay. Furthermore, the interaction of performance and board governance negatively impacts pay, supporting a substitution approach. It implies that setting optimal pay packages for executives necessitates enhanced and efficient board governance practices.

The study recommends significant policy implications for regulators and the board of directors that executive pay significantly responds to the bank’s performance and good board governance practices in the long run.

This paper provides novel evidence of long-run pay-performance-governance relation using a panel co-integration approach.

The study evaluates the accident-adjusted dynamic efficiency of public bus operators providing bus transportation services in eight major metropolitan cities of India.

The slack-based measure (SBM)–undesirable window analysis approach is used to gauge the dynamic efficiency levels and identify the sources of inefficiency in bus transportation services. This innovative approach integrates the SBM model developed by Tone (2001, 2004) and the window analysis approach of Charnes et al. (1985). The main advantage of this approach is that one can explicitly incorporate the number of accidents in the production technology specification as an undesirable (bad) output and potently handle the issue of the “curse of dimensionality” in a small sample like ours.

The key empirical findings suggest wide variations in average efficiency levels across sample bus operators in metropolitan cities. The Chennai Transport Corporation is observed as the most efficient and consistent bus operator due to its most stable efficiency performance. The results additionally unveil that the role of managerial inefficiency was diminutive, and the scale-related issues were the real cause of sub-optimal or supra-optimal behaviour of sample bus operators in the resource-utilisation process.

There is an urgent requirement for effective policy intercessions to mitigate the sizeable observed inefficiency in the production process and resolve scale-related issues of public bus operators offering transit services in major metropolitan cities of India.

This paper is maybe the first to assess the dynamic efficiency of public bus transit systems in India's major metropolitan cities after treating accidents.