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Volume 6 (20) Number 3 pp. 105-117

Katarzyna Mroczek-Dąbrowska1, Yaron Shemesh1

1Department of International Competitiveness, Poznań University of Economics and Business, Poznań, Poland.

(Re)-structuring the CEO’s compensation—the case of Israel

Abstract:

The executive compensation issue continues to cause protest due to the increasing
number of cases of an unjustifiably high level of pay. The main conflict arises
from the misalignment of interests between the short-term expectations of the manager
and long-term needs of the shareholders. Since there are no universal rules on how to
price the executive performance companies reach for different means of establishing
the CEO’s compensation and ascertaining manager’s commitment towards maintaining
a company’s value. The issue becomes more complex once the compensation rules are
not a direct effect of the market power game but are additionally restricted by government.
The aim of the paper is to discuss corporate government policies introduced in
Israel and their impact on executive compensation level and structure. Israel is amongst
those countries that partially regulate CEO compensation and thus the Israeli experience
can add to the understanding of the effectiveness of modern corporate governance.

pub/2020_3_105.pdf Full text available in in Adobe Acrobat format:
http://www.ebr.edu.pl/volume20/issue3/2020_3_105.pdf
Keywords: CEO compensation, inequalities, compensation gap, agency theory, principal– agent conflict, corporate governance

DOI: 10.18559/ebr.2020.3.6

For citation:

MLA Mroczek-Dąbrowska, Katarzyna, and Yaron Shemesh. "(Re)-structuring the CEO’s compensation—the case of Israel." Economics and Business Review EBR 20.3 (2020): 105-117. DOI: 10.18559/ebr.2020.3.6
APA Mroczek-Dąbrowska1, K., & Shemesh1, Y. (2020). (Re)-structuring the CEO’s compensation—the case of Israel. Economics and Business Review EBR 20(3), 105-117 DOI: 10.18559/ebr.2020.3.6
ISO 690 MROCZEK-DąBROWSKA, Katarzyna, SHEMESH, Yaron. (Re)-structuring the CEO’s compensation—the case of Israel. Economics and Business Review EBR, 2020, 20.3: 105-117. DOI: 10.18559/ebr.2020.3.6