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  • CHVZ_20170930

    Rights statement: This is the author’s version of a work that was accepted for publication in Journal of Corporate Finance. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Journal of Corporate Finance, ??, ?, 2018 DOI: 10.1016/j.jcorpfin.2017.12.016

    Accepted author manuscript, 911 KB, PDF-document

    Embargo ends: 6/07/19

    Available under license: CC BY-NC-ND

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Foreign Experience and CEO Compensation

Research output: Contribution to journalJournal article

E-pub ahead of print
<mark>Journal publication date</mark>6/01/2018
<mark>Journal</mark>Journal of Corporate Finance
<mark>State</mark>E-pub ahead of print
Early online date6/01/18
<mark>Original language</mark>English

Abstract

This paper investigates the relationship between a CEO’s foreign experience and CEO compensation. Our analysis is based on the constituent firms of the UK FTSE 350 index from 1999 to 2015. We find that foreign CEOs and national CEOs with foreign working experience receive significantly higher levels of total compensation compared to similar UK CEOs without such characteristics. The results are robust to the endogenous CEO selection using propensity score matching methods, as well as other modelling approaches. Our results show that pay premiums are attributable to the specialized foreign expertise and foreign networks of CEOs, which stem from foreign experience rather than broader general managerial skills.

Bibliographic note

This is the author’s version of a work that was accepted for publication in Journal of Corporate Finance. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Journal of Corporate Finance, ??, ?, 2018 DOI: 10.1016/j.jcorpfin.2017.12.016