Research Repository

Directors' remuneration: A comparison of Italian and UK non-financial listed firms' disclosure

Melis, Andrea and Gaia, Silvia and Carta, Silvia (2015) 'Directors' remuneration: A comparison of Italian and UK non-financial listed firms' disclosure.' The British Accounting Review, 47 (1). 66 - 84. ISSN 0890-8389

[img]
Preview
Text
BAR MS 120878.pdf - Accepted Version

Download (367kB) | Preview

Abstract

Directors' remuneration is a key issue for both academics and policymakers. It has caused enormous controversy in recent years. This study uses a comprehensive index to analyse the disclosure of directors' remuneration in Italian and UK listed firms. It finds that the level of voluntary disclosure is significantly associated with firm-specific incentives, such as the demand for information from investors and the need for legitimacy. It finds that the level of voluntary disclosure is significantly higher in the UK than in Italy and that firm-specific incentives to disclose voluntary information differ according to the institutional setting in which a firm operates. In the UK, firm-specific incentives mostly come from the demand for information, estimated with the level of ownership diffusion, and the need for legitimacy generated by poor market performance and shareholders' dissent. In Italy, firm-specific incentives seem to be represented by the need for legitimacy generated by media coverage. This study also provides evidence that, in both countries, the information disclosed in corporate documents does not allow readers to obtain a comprehensive picture of directors' remuneration. Bonuses are poorly disclosed even though they are a key element of directors' remuneration. This finding is clearly important for policymakers at European and national level.

Item Type: Article
Subjects: H Social Sciences > HF Commerce > HF5601 Accounting
Divisions: Faculty of Social Sciences > Essex Business School
Faculty of Social Sciences > Essex Business School > Essex Accounting Centre
Depositing User: Silvia Gaia
Date Deposited: 02 Jun 2015 10:15
Last Modified: 06 Feb 2019 20:15
URI: http://repository.essex.ac.uk/id/eprint/13857

Actions (login required)

View Item View Item