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The purpose of this paper is to examine CEO compensation in immigrant-founder firms vs CEO compensation in non-immigrant-founder firms.

Univariate and multi-variate tests are implemented. CEO compensation is designed as a function of the origin of a firm’s founder (immigrant or native), executive characteristics and firm characteristics with firm and year fixed effect regressions. CEO compensation is measured with cash pay, equity-based pay and total compensation.

CEOs of immigrant-founder firms receive higher equity-based compensation and higher total pay than CEOs of non-immigrant-founder firms and the levels of their equity-based and total compensation are contingent upon their stock ownership. CEOs in high-growth immigrant-founder firms receive higher stock-based pay than their counterparts in non-immigrant-founder firms. Immigrant-founder family firms compensate their CEOs with higher equity-based pay than immigrant-founder non-family firms.

The paper provides some explanations on the success of immigrant-founder firms. CEO compensation designs in immigrant-founder firms can be adopted in other firms.

The paper provides some rationale for immigration legislation to encourage the talented to come to the USA and start their business in the USA.

This paper is the first to study executive compensation practice in immigrant-founder firms. The findings provide some practical and policy implications on immigration reform.

By investigating the use of formal compensation practices in family small- and medium-sized enterprises (SMEs), the purpose of this paper is to provide important new insights in these issues for academics, as well as family business practitioners, prospective applicants and financiers of family businesses. Moreover, this study includes a contingency that allows to explore heterogeneity across family businesses in their use of formal compensation practices: the CEO type.

A survey of 124 small- and medium-sized Belgian family businesses to explore the use of formal compensation practices is analyzed by the author.

The results support the hypothesis that family firms with a family CEO adopt significantly less formal compensation practices than their counterparts that are led by a non-family CEO.

Generalizing the findings of this study must be taken with care, as the findings are based on a cross-sectional sample of family SMEs in one country, Belgium. Future research can build on these findings with studies on larger samples in other countries.

This study may be interesting for family business practitioners and consultants, as it provides insight in the actual use of formal compensation practices that are recommended as a best practice in numerous practitioner handbooks. Also, the results of this study might be important for prospective applicants and financiers, since the compensation system is an important communication device to signal legitimacy to external stakeholders.

Compensation issues are among the main challenges SMEs, especially family firms, face. Despite the clear importance of this matter, academic interest has been rather limited. This paper therefore displays sound descriptive survey results and empirically investigates the determinants of the use of formal compensation practices in Belgian family SMEs by distinguishing between different types of family businesses.

The purpose of this paper is to use the socio‐emotional wealth perspective to examine how the level of family involvement reduces the propensity to use incentives to non‐family managers in small to medium‐sized enterprises (SME) family firms.Design/methodology/approach – Primary data were collected from US firms. To evaluate the hypotheses, a logit model was employed on a final sample of 2,019 small family firms.

Results suggest that family influence and control and intra‐family transgenerational succession intentions are negatively related to the propensity to use incentives. Also, the interaction effects of family management and ownership reduce the propensity to use incentives.

The paper’s empirical findings imply that despite their potential economic benefits, family involvement reduces the probability that incentives will be offered to non‐family managers because such incentives are perceived to be inconsistent with the preservation of the family’s socioemotional wealth. Also, choices that reflect a preference for socioemotional wealth may not only be a function of decision framing and loss aversion but also by the size of the economic pay‐offs that might be available. The findings suggest that non‐family managers in SME family firms may be affected by a family’s preoccupation with its socioemotional endowments. Thus, the authors expect that this paper provides further avenues to explore the decisions about attaining non‐economic and economic goals and other strategic issues in family firms.

As widely known and well established, strategic decision-making at family firms is an interface between business interests and family considerations. The purpose of this paper is to understand the underlying basis of decision-making in setting corporate strategy and designing chief executive officer (CEO) compensation at founder- vis-à-vis descendant-led family firms in the Indian pharmaceutical sector.

A sample of 106 BSE-listed pharmaceutical companies have been studied over the period 2012–2017 resulting in a total of 636 firm-year observations. Impact of family involvement in business (FIB) on corporate strategy and CEO compensation has been analysed by constructing multivariate panel data regression models. To deal with the problem of endogeneity, Arellano-Bond (1991) dynamic panel data estimation procedure has moreover been conducted.

Supporting stewardship theory, founder-owned and governed firms have been found to favour “growth” strategy and distribute “conservative” executive pay, thereby exerting a positive moderating impact on the strategy-compensation linkage. On the contrary, descendants/second-generation entrepreneurs have put forth a “conservative” stance for growth and innovation, and have rather been observed to favour a “liberal” compensation policy, thereby showcasing the application of behavioural agency theory.

The research is a novel attempt to unravel the interaction between corporate strategy and CEO compensation in a family firm backdrop carried out in the context of an emerging economy. The study, moreover, adopted an all-encompassing definition of FIB (ownership, management and governance).

The purpose of this study is to analyse the level and structure of executive compensation of family and non-family businesses and if minority shareholders are expropriated by family businesses in the Australian context using excessive pay. Studies on compensation practices of family businesses are limited to the European and North American contexts. This study, for the first time, considers the Australian context, which is unique with its transparent compensation disclosures, and a principle-based corporate governance framework to examine the level of compensation as well as the association between pay and performance.

A set of family and matched non-family firms for the period 2004–2014 are examined in a panel data setting. Robust models are estimated to examine the association between compensation and a set of economic, governance and ownership factors.

This study finds evidence that family businesses in general pay lower levels of compensation than non-family businesses. An investigation of the role of economic factors on compensation of family and non-family businesses shows evidence that supports the optimal contracting theory. Further examination of governance factors on compensation levels and pay–performance sensitivities shows there is a limited role for managerial power approach in explaining the executive compensation practices of family businesses in Australia. These findings infer that family businesses, given their interest in non-financial goals, do not pay excessive compensation to their executives to expropriate minority shareholders.

These findings have implications for theory relating to executive compensation and human resource management in all types of businesses, including family firms. These findings offer support for the theory of optimal contracting. Empirical analysis shows no evidence of entrenchment effect or managerial power in family businesses in Australia. In terms of theory-building, there is role for socioemotional wealth model in addition to optimal contracting theory and managerial power approach.

The findings of this study also have implications for practice. Compensation practices may be designed in such a way that executives and firms pursue broader social goals such as the sustainable development goals or more generally non-financial objectives. Businesses may not necessarily use only financial outcomes when assessing appropriate level of pay of executives. Often, the financial outcomes may involve wealth transfers between different stakeholders and may not necessarily lead to improving the societal well-being. In terms of human resource management, the findings of this study emphasise the need for explicit consideration of socioemotional wealth of all family-related and non-related employees when designing recruitment, training, reward and recognition policies.

This study highlights the role non-financial factors play in executive pay setting processes in family businesses in a highly transparent and principle-based governance framework. Family businesses in Australia are not motivated by monetary considerations, and that their interest in non-financial objectives leads to less emphasis on the link between compensation and performance.

Human resource management is an understudied but burgeoning topic in the family business scholarly domain. This chapter provides a summary review of the existing literature on human resource management in family businesses and offers pathways for future research. The authors cluster the extant research into topic areas of compensation, recruitment and selection, training, employee performance, and turnover, and offer future research directions for each. In identifying gaps and tension in the literature, the chapter also highlights several broader theoretical pathways for future research. These opportunities include further inquiry into the outcomes of bifurcation bias, or the disparate treatment between family and non-family employees, the nuanced ways family firms recruit and select new employees, the role of high-performance work systems in family firms, the ways image considerations influence human resource practices in family firms, and the application of social network perspectives.

This paper aims to investigate the effect of governance mechanisms and firm performance on chief executive officer (CEO) compensation in relation to the Jordanian business environment. This study also examines the moderating role of gender diversity.

The sample is drawn from the annual reports of 68 Jordanian firms between 2015 and 2019. This paper uses the ordinary least square regression. It also uses the generalised method of moments approach to control any endogeneity issue and analyses the data in depth. In addition, it uses a dynamic model to address concerns regarding causality in the study’s models.

The results show that governance mechanisms and firm performance have an impact on CEO compensation. Furthermore, the outcomes indicate that gender diversity significantly and positively moderates the association between firm performance and CEO compensation. These findings enhance and support agency theory in the context of Jordan.

The study’s results have significant implications for policymakers, shareholders, investors, academicians and the public in the developing Jordanian market. The findings also support more monitoring and inspection to prevent the occurrence of opportunistic management behaviour and ensure that CEO remuneration packages are appropriately designed.

This study provides a unique understanding by explaining the impact of governance and performance on CEO compensation in a developing country such as Jordan. Besides that, the current study extends prior studies in Jordan significantly.

This study aims to examine the employment practices of family firms in emerging markets. Drawing from the social exchange theory, the authors propose that transgenerational control intention enhances the motivation for family owners to engage in favorable employment practices as inducement for future contribution of employees.

Multilevel regression models were applied to test the hypotheses with a sample of 3033 Chinese private family firms.

The results show that the employment practices of family firms are positively associated with transgenerational control intention, and the effect of transgenerational control intention is contingent on regional social trust.

This study highlights the role of transgenerational control intention of family owners in motivating favorable employment in family firms. The study adds nuance to the variances in employment behaviors of family firms as well as the family owner-employee exchange relationship in emerging markets.

The purpose of this paper is to analyse 100 of the largest family firms and their personnel costs and employee numbers compared to non-family firms in the Czech Republic and confirm if there exist differences between personnel costs for family and non-family firms.

The sample consisted of 100 family firms and 97 non-family firms from the Czech Republic for the comparison. Four hypotheses about relation between personnel costs for family and non-family firms and their governing body were set. Descriptive statistics were calculated, and t-tests and Kruskal–Wallis test for confirmation of set hypothesis were used.

Sales volume and production consumption results are used as variables, which were compared between family and non-family firms to achieve the most relevant possible conclusions. Based on our results, it can be stated that differences between personnel costs, which, in this study, comprise employee wages, are not statistically significant in the largest Czech family firms. There are significant differences in personnel costs for company boards. In comparing employee numbers and the number of members of statutory bodies, however, no significant difference was ascertained.

This study responds to a gap in the literature, by exploring the differences between personnel costs (for employees and governing body) in the area of the Czech Republic. This study also contributes to the understanding of the remuneration within family firms, by assessing the role of executive remuneration in family firms.

The purpose of this study is to examine the impact of corporate governance (CG) on chief executive officer compensation (CEO COMP) and pay–performance relationship (PPR) in Indian listed firms.

A sample of 196 companies listed on the S&P BSE 500 (Standard and Poor's Bombay Stock Exchange 500) Index has been analyzed using the panel (random effects) regression technique over the period 2010–2019. In addition, the system GMM technique was used to deal with the endogeneity issue.

The study found that block ownership and ownership concentration negatively impact COMP measures and PPR. Board size also had a negative direct and moderating impact on CEO COMP; however, the linkages were generally insignificant, especially for total pay. Similarly, outsider blockholders were found to be playing an insignificant role. Further, board independence positively influences COMP levels and PPR, though the results were mixed with respect to significance. Finally, CEO duality positively and significantly influences CEO COMP and PPR. A comparison before and after the new Indian Companies Act 2013 also revealed similar results, particularly in the after period. It suggests that the new legislative initiative was not effective enough in improving the CG and, hence, the alignment of pay with performance.

This study investigates the direct and moderating impact of CG on CEO COMP in the context of emerging economy India. Further, it makes a comparison before and after the introduction of the new governance reform, that is, the Indian Companies Act, 2013. Moreover, providing support to the entrenchment effect, the study reveals that large shareholders expropriate minority shareholders’ wealth by not aligning CEO pay with performance, making agency problems graver in emerging economies like India.