TY - JOUR
T1 - Executive compensation: A justified reward or a mis-fortune, an empirical analysis of banks in Pakistan
AU - Watto, Waqas Ahmad
AU - Fahlevi, Mochammad
AU - Mehmood, Sidra
AU - Asdullah, Muhammad Ashar
AU - Juhandi, Nendi
N1 - Funding Information: The Authors would like to thank the Research and Technology Transfer Office (RTTO), Bina Nusantara University (BINUS University), who has funded the research results‘ publication costs.
PY - 2023/9
Y1 - 2023/9
N2 - The relationship between compensation, performance, and risk in a sample of Pakistani banks, using panel data for 20 banks from 2011 to 2021 has been examined in this research. To the best of researcher's knowledge, this is one of the first study examining the relationship between performance, risk and employee compensation using panel data approach in the context of Pakistan and using data for longer period. To examine the influence of employee compensation on the performance and risk of banks, we employed three performance measures: return on assets, return on equity, and operating profits. Risk assessment was conducted using non-performing loans and risk-weighted assets. Findings of study suggest that employee compensation has no significant impact on performance and risk of banks in Pakistan; this means in Pakistan higher employee's compensation does not enable banks to improve their performance or enable banks to take more risk.
AB - The relationship between compensation, performance, and risk in a sample of Pakistani banks, using panel data for 20 banks from 2011 to 2021 has been examined in this research. To the best of researcher's knowledge, this is one of the first study examining the relationship between performance, risk and employee compensation using panel data approach in the context of Pakistan and using data for longer period. To examine the influence of employee compensation on the performance and risk of banks, we employed three performance measures: return on assets, return on equity, and operating profits. Risk assessment was conducted using non-performing loans and risk-weighted assets. Findings of study suggest that employee compensation has no significant impact on performance and risk of banks in Pakistan; this means in Pakistan higher employee's compensation does not enable banks to improve their performance or enable banks to take more risk.
KW - Executive compensation
KW - Non-performing loans
KW - Return of assets
KW - Return on equity
KW - Risk weighted assets
UR - http://www.scopus.com/inward/record.url?scp=85165920758&partnerID=8YFLogxK
U2 - 10.1016/j.joitmc.2023.100092
DO - 10.1016/j.joitmc.2023.100092
M3 - Article
AN - SCOPUS:85165920758
VL - 9
JO - Journal of Open Innovation: Technology, Market, and Complexity
JF - Journal of Open Innovation: Technology, Market, and Complexity
SN - 2199-8531
IS - 3
M1 - 100092
ER -