Alison M. Konrad and John Deckop
Productivity gains powered by technological innovation have fueled expansion of the US economy during the 1990s. US economic prosperity has led to labor shortages, which are…
Abstract
Productivity gains powered by technological innovation have fueled expansion of the US economy during the 1990s. US economic prosperity has led to labor shortages, which are pushing organizations to engage in creative recruitment and retention practices and to employ workers from non‐traditional sources, leading to a more diverse workforce. HR professionals are realizing that they need to update their technological skills and develop systems for managing more virtual organizations. Human resource (HR) is also trying to become more of a strategic partner in firms. HR has the potential to create competitive advantage for firms by successfully combining a reputation as being an employer of choice with a high performance work system and an effective set of incentives.
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This paper proposes a hegemonic power hypothesis to examine the determinants of CEO compensation by drawing on insights from the field of international relations. It then reports…
Abstract
This paper proposes a hegemonic power hypothesis to examine the determinants of CEO compensation by drawing on insights from the field of international relations. It then reports results of an empirical test of this hypothesis. The results indicate a limited support for the hegemonic power hypothesis, indicating the importance of a cross‐disciplinary perspective in studying the determinants of CEO compensation.
Employee dissatisfaction with merit pay is a long‐standing problem. This study introduces four explanatory constructs, based on decisional and interactional fairness notions, that…
Abstract
Employee dissatisfaction with merit pay is a long‐standing problem. This study introduces four explanatory constructs, based on decisional and interactional fairness notions, that describe how supervisors implement merit pay and predict merit pay satisfaction. Multigroup confirmatory factor analyses, applied to a sample of American employees (N = 415) and a sample of Venezuelan employees (N = 239), show that the five constructs introduced here are distinct from each other and that their measures generalize across countries (cultures and languages).
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Ilona Bučiūnienė and Rūta Kazlauskaitė
The purpose of this paper is to look into the current corporate social responsibility (CSR) and human resource management (HRM) developments in Lithuania and to study the…
Abstract
Purpose
The purpose of this paper is to look into the current corporate social responsibility (CSR) and human resource management (HRM) developments in Lithuania and to study the relationship between CSR, HRM and organisational performance outcomes.
Design/methodology/approach
A survey of 119 medium and large‐sized organisations (over 100 employees) in Lithuania was conducted to study CSR and HRM implementation in the country and to test the relationship between CSR, HRM and organisational performance outcomes.
Findings
In total, 78.1 per cent of the respondent organisations have a written or unwritten HR strategy. Only 38.8 per cent have a CSR statement, but more than half of respondent organisations have a code of ethics, corporate values statement and diversity statement (respectively 65.4, 63.0 and 53.1 per cent). Research findings show that there is a linkage between HRM, CSR and performance outcomes – organisations with more developed HRM, i.e. those where HRM performs a strategic role and the HR function performance is evaluated, have better developed CSR policies. The latter were found to have an impact on organisational and financial performance outcomes.
Research limitations/implications
The study is built on the Cranet survey data, therefore not all CSR‐related HRM practices are analysed. Due to a limited number of organisations using CSR‐related HRM practices, the statistical analysis fails to determine statistically significant relationships between the usage of those practices, the level of CSR development and performance outcomes.
Practical implications
Organisations that are socially responsible and follow a strategic approach to HRM exhibit better performance outcomes, profitability in particular.
Originality/value
The paper confirms the existence of the HRM‐CSR‐performance linkage, i.e. organisations with better developed HRM, where HR plays a more strategic role and its performance is more evaluated, also have more developed formal CSR policies, which in turn has a positive impact on organisational and financial performance outcomes.
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Ahmad Hammami, Rucsandra Moldovan and Elisabeth Peltier
This paper aims to examine the role that auditor’s salary perception has on audit quality and delay. The findings contribute to a greater understanding of the audit employee-level…
Abstract
Purpose
This paper aims to examine the role that auditor’s salary perception has on audit quality and delay. The findings contribute to a greater understanding of the audit employee-level factors that influence audit work outcomes.
Design/methodology/approach
The authors use Big 6 employee reviews, salary data and audit and financial data from 2007 to 2017 to measure how to audit employees’ pay satisfaction affects audit quality (small profits and going concern opinions) and audit delay. The authors use a regression approach to analyze this relationship. In subsequent tests, the authors split the sample on high career opportunities to investigate how this moderates the relationship between salary perception and audit quality.
Findings
The authors document a discrepancy between pay perception and reality. It is explained, though not completely, by salary level, comparisons to peers and superiors, firm-wide attitudes, cost of living and human capital in the area, work–life balance and perceived career prospects. Surprisingly, the unexplained pay dissatisfaction relates positively to audit quality and audit efficiency (audit delay), after controlling for salary level. Further tests show that an audit employee’s expectation of career opportunities moderates this result.
Originality/value
This is the first paper that empirically tests the relationship between pay satisfaction and job performance in the context of audit employees in public accounting. The authors contribute to an emerging literature that investigates audit employee-level characteristics and attitudes in relation to audit quality.
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Tae-Youn Park, Reed Eaglesham, Jason D. Shaw and M. Diane Burton
Incentives are effective at enhancing productivity, but research also suggests that performance incentives can have “unintended negative consequences” including increases in…
Abstract
Incentives are effective at enhancing productivity, but research also suggests that performance incentives can have “unintended negative consequences” including increases in hazard/injuries, increases in errors, and reduction in cooperation, prosocial behaviors, and creativity. Relatively overlooked is whether, when, and how incentives can be designed to prevent such negative consequences. The authors review literature in several disciplines (construction, healthcare delivery, economics, psychology, and [some] management) on this issue. This chapter, in toto, sheds a generally positive light and suggests that, beyond productivity, incentives can be used to improve other outcomes such as safety, quality, prosocial behaviors, and creativity, particularly when the incentives are thoughtfully designed. The review concludes with several potential fruitful areas for future research such as investigations of incentive-effect duration.
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Executive compensation equations are estimated separately for three groups of firms, under the contention that the determinants of executive remuneration may depend upon the form…
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Executive compensation equations are estimated separately for three groups of firms, under the contention that the determinants of executive remuneration may depend upon the form of and degree of regulation in an industry. Empirical evidence obtained for three separate years lends support to that notion.
Fanny Caranikas‐Walker, Sanjay Goel, Luis R. Gómez‐Mejía, Robert L. Cardy and Arden Grabke Rundell
The empirical support for agency theory explanations for the great variance in CEO pay has been equivocal. Drawing from the performance appraisal literature, we hypothesize that…
Abstract
The empirical support for agency theory explanations for the great variance in CEO pay has been equivocal. Drawing from the performance appraisal literature, we hypothesize that boards of directors incorporate human judgment into the evaluation and reward of CEO performance in order to balance managerial risk with agency costs. We test Baysinger and Hoskisson’s (1990) proposition that insider‐dominated corporate boards rely on subjective performance evaluation to reward the CEO, and we argue that R&D intensity influences this relationship. Using a sample of Fortune firms, findings support our contention that human judgment is important in evaluating and rewarding CEO performance.
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Relying on proprietary Canadian data, we determine a positive relationship between the level of Canadian CEO compensation and the existence of significant international components…
Abstract
Relying on proprietary Canadian data, we determine a positive relationship between the level of Canadian CEO compensation and the existence of significant international components among a CEO’s array of responsibilities. Our findings are consistent with agency and human capital theoretical arguments. Results imply that executive pay premiums should be anticipated and budgeted for in the planning and implementation of international ventures.
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Alexandra E. MacDougall, Zhanna Bagdasarov, James F. Johnson and Michael D. Mumford
Business ethics provide a potent source of competitive advantage, placing increasing pressure on organizations to create and maintain an ethical workforce. Nonetheless, ethical…
Abstract
Business ethics provide a potent source of competitive advantage, placing increasing pressure on organizations to create and maintain an ethical workforce. Nonetheless, ethical breaches continue to permeate corporate life, suggesting that there is something missing from how we conceptualize and institutionalize organizational ethics. The current effort seeks to fill this void in two ways. First, we introduce an extended ethical framework premised on sensemaking in organizations. Within this framework, we suggest that multiple individual, organizational, and societal factors may differentially influence the ethical sensemaking process. Second, we contend that human resource management plays a central role in sustaining workplace ethics and explore the strategies through which human resource personnel can work to foster an ethical culture and spearhead ethics initiatives. Future research directions applicable to scholars in both the ethics and human resources domains are provided.