Thursday, October 30, 2014

The Daily Stat from Harvard Business Review

  Daily Stat - Harvard Business Review

October 30, 2014

Who Cashes in Most on the Value That CEOs Add to Their Companies? CEOs Themselves


On average, 65% of the value CEOs add to their companies through their vision and managerial skills comes back to them in the form of their cumulative pay, and shareholders divide up the remaining 35%, according to a novel study of U.S. companies by Bang Dang Nguyen of the University of Cambridge in the UK and Kasper Meisner Nielsen of Hong Kong University of Science and Technology. The researchers reached their conclusions by looking at what happens to the stock prices of companies after CEOs die suddenly; in most cases, stock prices decline, but sometimes the equity market reacts positively to CEOs' passing.

SOURCE: What Death Can Tell: Are Executives Paid for Their Contributions to Firm Value?


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