Global Financial Crisis, Directors Remuneration and Performance

A substantial and influential literature demonstrates conflicting evidence that director remuneration is either positively or negatively correlated with corporate performance. In some instances, studies suggested to have no link between director remuneration and corporate performance. Research interest in this topic has been further fuelled with the collapse of many multinational banks during the recent global financial crisis. In this research, a re-examination of the link between director remuneration and firm performance in the big four Australian banks is being conducted. We used both financial data and non-financial data. Financial data is retrieved from databases such as Aspect Fin Analysis and banks annual report and non-financial data retrieved from various newspaper and other available publications. Overall this we found there is no relationship between director remuneration and firm performance in the big four banks for the period pre, during or post Global Financial Crisis. These findings also hold true with a lag and lead years and goes on to suggest that the relationship between the director remuneration and performance dosen't forge a link in the long term as well.

Autorentext

In Australia BIG4 banks constitute an oligopoly commanding a combined 90% market share of Australia's commercial banking sector. Dr. Azim and Mr. Subramanian from Swinburne University investigates the most debated issue: director remuneration firm performance of these BIG4 Banks (CBA, NAB, ANZ, Westpac) pre, during and post Global Financial Crisis