Pay dispersion among the top management team and outside directors: Its impact on firm risk and firm performance
基于锦标赛理论和公平理论，研究了高管团队与外部董事之间不可解释的薪酬差距对企业战略风险和绩效的影响，发现高管团队的薪酬差距对绩效提升更重要。
Two key groups central to improving firm performance are the top management team (TMT) and the board of directors. Executives undertake strategic actions, whereas board members fulfill their resource provision and monitoring roles. Drawing on tournament theory and equity theory, we propose that high pay dispersion among outside directors and the TMT is positively associated with strategic risk, whereas high (low) TMT pay dispersion and low (high) outside director pay dispersion are positively associated with firm performance. Our predictor is the unexplained component of horizontal pay dispersion, or the residual of pay dispersion resulting from regressing pay on observable firm, industry, period, and individual characteristics. Our results highlight the importance of unexplained pay dispersion for TMTs, but not for boards of directors, in improving firm performance.