This dissertation contains five research projects within the context of two distinctive issues that concern the effectiveness of executive compensation in aligning executive interests with shareholders and how institutional investors play a role in structuring corporate governance mechanisms. The objective of this dissertation is to first determine how institutions should exert their influence if they are serious about alleviating agency problems and improving firm performance. Second, the thesis seeks to determine whether institutional investors use their influence to shape executive compensation and corporate governance mechanisms in a manner consistent with aligning managerial interests with shareholders and increasing shareholder wealth. The thesis finds that CEOs with option incentives increase the likelihood that a firm will increase risk by undertaking both major real investments and acquisitions. Moreover, CEO option grants are positively related to measures of firm valuation and operating performance suggesting option incentives are an important mechanism to align CEO interests with shareholders. This is robust to alternative measures of firm valuation and operating performance, also various estimation techniques. Using these findings to motivate the direction of institutional influence on executive compensation, it is found that institutional investors, particularly smaller activist traders, significantly increase option grant incentives received by executives. Institutional influence also raises CEO pay which is consistent with preservation of reservation CEO utility levels. Addressing the role of institutional investors in the context of other corporate governance mechanisms, it is found that institutional investor influence is also negatively related to board size and positively related to board independence, which is achieved by removal of inside directors. Such actions are consistent with empirical studies that show smaller boards and increased levels of independent directors improve firm performance and board decision making. The main conclusion from this dissertation is that option incentives are an effective mechanism to align CEO interests with those of shareholders. Institutional investors appear to recognise this importance, and effectively use their influence to increase options received by executives. Combined with institutional investors putting in place corporate boards that provide better oversight of management, institutional investors appear to be effective monitors of the firms in which they invest.

This dissertation contains five research projects within the context of two distinctive issues that concern the effectiveness of executive compensation in aligning executive interests with shareholders and how institutional investors play a role in structuring corporate governance mechanisms. The objective of this dissertation is to first determine how institutions should exert their influence if they are serious about alleviating agency problems and improving firm performance. Second, the thesis seeks to determine whether institutional investors use their influence to shape executive compensation and corporate governance mechanisms in a manner consistent with aligning managerial interests with shareholders and increasing shareholder wealth. The thesis finds that CEOs with option incentives increase the likelihood that a firm will increase risk by undertaking both major real investments and acquisitions. Moreover, CEO option grants are positively related to measures of firm valuation and operating performance suggesting option incentives are an important mechanism to align CEO interests with shareholders. This is robust to alternative measures of firm valuation and operating performance, also various estimation techniques. Using these findings to motivate the direction of institutional influence on executive compensation, it is found that institutional investors, particularly smaller activist traders, significantly increase option grant incentives received by executives. Institutional influence also raises CEO pay which is consistent with preservation of reservation CEO utility levels. Addressing the role of institutional investors in the context of other corporate governance mechanisms, it is found that institutional investor influence is also negatively related to board size and positively related to board independence, which is achieved by removal of inside directors. Such actions are consistent with empirical studies that show smaller boards and increased levels of independent directors improve firm performance and board decision making. The main conclusion from this dissertation is that option incentives are an effective mechanism to align CEO interests with those of shareholders. Institutional investors appear to recognise this importance, and effectively use their influence to increase options received by executives. Combined with institutional investors putting in place corporate boards that provide better oversight of management, institutional investors appear to be effective monitors of the firms in which they invest.

This dissertation contains five research projects within the context of two distinctive issues that concern the effectiveness of executive compensation in aligning executive interests with shareholders and how institutional investors play a role in structuring corporate governance mechanisms. The objective of this dissertation is to first determine how institutions should exert their influence if they are serious about alleviating agency problems and improving firm performance. Second, the thesis seeks to determine whether institutional investors use their influence to shape executive compensation and corporate governance mechanisms in a manner consistent with aligning managerial interests with shareholders and increasing shareholder wealth. The thesis finds that CEOs with option incentives increase the likelihood that a firm will increase risk by undertaking both major real investments and acquisitions. Moreover, CEO option grants are positively related to measures of firm valuation and operating performance suggesting option incentives are an important mechanism to align CEO interests with shareholders. This is robust to alternative measures of firm valuation and operating performance, also various estimation techniques. Using these findings to motivate the direction of institutional influence on executive compensation, it is found that institutional investors, particularly smaller activist traders, significantly increase option grant incentives received by executives. Institutional influence also raises CEO pay which is consistent with preservation of reservation CEO utility levels. Addressing the role of institutional investors in the context of other corporate governance mechanisms, it is found that institutional investor influence is also negatively related to board size and positively related to board independence, which is achieved by removal of inside directors. Such actions are consistent with empirical studies that show smaller boards and increased levels of independent directors improve firm performance and board decision making. The main conclusion from this dissertation is that option incentives are an effective mechanism to align CEO interests with those of shareholders. Institutional investors appear to recognise this importance, and effectively use their influence to increase options received by executives. Combined with institutional investors putting in place corporate boards that provide better oversight of management, institutional investors appear to be effective monitors of the firms in which they invest.

Thesis (Ph. D.)--University of Nevada, Reno, 2007. / "May, 2007." Includes bibliographical references (leaves 77-87). Online version available on the World Wide Web.

Thesis (Ph. D.)--University of Texas at Austin, 2004. / Supervisor: Robert Freeman. Vita. Includes bibliographical references.

Thesis (M.B.A.)--Massachusetts Institute of Technology, Sloan School of Management, 2004. / Title from title screen (viewed Nov. 9, 2005). "June 2004." Includes bibliographical references (p. 63-65). Also issued in paper format.

M.A. / Aihoewel die tradisionele organisasie oor die algemeen 'n soliede vergoedingstelsel met 'n sterk fokus op koste-effektiwiteit en administratiewe presisie gehad het, het die moderne organisasie, wat gekenmerk word deur platter organisasiestrukture, groter buigsaamheid, 'n meer deelnemende bestuurstyl en 'n groter mate van openheid, ander vereistes gestel aan die tradisionele vergoedingstelsel. Die modeme vergoedingstelsel, wat die modeme organisasie kenmerke ondersteun, word beskou as 'n stelsel wat uitset gerig is, met min salarisvlakke, wat min of geen status simbole bevat, wat groter deursigtigheid bevorder en waar meganistiese beheer stelsels vervang word met analitiese bestuursbeheer. Dit het aanleiding gegee daartoe dat nuwe moderne vergoedingspraktyke, onder meer ook bandverbreding, die lig gesien het. Die verhandeling het ten doel om bandverbreding, wat gedefinieer word as die vermindering van posvlakke en die dienooreenkomstige verbreding van salarisbande, om sodoende 'n platter organisasiestruktuur te skep wat groter aanpasbaarheid en dinamika tot gevolg sal he, te verken en te omskryf. Die fokus val veral op die ontwerp en die proses van implementering van bandverbreding binne 'n Suid-Afrikaanse organisasie. Die tradisionele posevalueringstelsel, wat die hart van enige vergoedingstelsel gevorm het, het sterk onder die vergrootglas gekom nadat die bandverbredingsproses bekendgestel is. Die invloed van bandverbreding op die onderskeie posevalueringstelsels asook op die plek daarvan binne 'n holistiese vergoedingstrategie word van naderby bekyk en beskryf Die teoretiese oorsig dek ook onder andere die redes waarom organisasies bandverbreding implementeer, die gereedheid van organisasies vir die bandverbredingsproses, die praktiese probleme waarmee organisasies gekonfronteer word wanneer bandverbreding geimplementeer word en mites aangaande die proses. Twee Suid-Afrikaanse organisasies binne die finansieledienste bedryf wat bandverbreding in sy voile omvang geimplementeer het, het die basis gevorm van die ondersoek. Die faktore wat aanleiding gegee het tot die implementering van bandverbreding, en wat die gereedheid van die organisasie beinvloed het, die potensiele struikelblokke, die ontwerp van die bandverbredingstrukture asook die implementeringsproses wat beide organisasies gevolg het, het die navorser in staat gestel om 'n aanbeveling to maak aangaande 'n implementeringsmodel. Die implementeringsmodel, wat beskou kan word as 'n opsomming van die bevindinge van die navorsing, beveel aan dat bandverbreding as deel van 'n holistiese vergoedingstrategie geimplementeer word en dat die proses deur 'n vergoedingsfilosofie, wat die bandverbredingsfilosofie komplimenteer, ondersteun word. Dit is egter duidelik dat alhoewel die bandverbredingskonsep 'n groot bydrae kan maak tot die vestiging van die modeme organisasie, die sukses daarvan opgesluit le in die effektiewe implementering en toepassing daarvan.

M. Com. (Business Management) / Managers are increasingly expressing their anxiety about their future security, and are more concerned than ever about their job security and a stable set of rewards. This concern has been triggered by the employers who are having to make increasingly difficult decisions about their workforce compensation and its relationship to performance. There is a general perception that organisations use ‘one size fits all’, type of rewards to motivate their managers. There is also a perception that managers are only motivated by financial rewards as compared to non-financial rewards in order for them to stay with the company. The aim of the study: The aim of this study was to determine whether rewards are perceived as a motivator by managers at a furniture retail company. Motivation for the study: The rationale for this study was to find out the perception of managers with regards to rewards as a motivator. Research design, approach and method: This survey study used quantitative methods to determine the perceptions of rewards amongst managers at a furniture retail company. The target population of the study was 172 junior and middle-level managers working for a furniture retail company. In this study the target population included women and men of different age groups, race groups, and so forth. Non- probability sampling (purposive sampling) was employed as the intent was to survey junior and middle managers only. SPSS Version 15 was used to analyse the data to ensure that a quantitative analysis for the study could be conducted. The completed questionnaires by the respondents were coded and analysed to calculate frequency distribution to analyse personal data, central tendency and percentage distribution. These statistics were presented in the form of computer graphics with the help of STATKON for data analysis. The Mann-Whitney U test was used for this study to distinguish between two groups of samples in the population in order to decide whether there was a statistically significant difference. Main findings: The results for this study showed that there were statistically significant relationships between age and compensation. The results revealed that there was a significant difference in the level of importance attributed to compensation from management between female managers and their male counterparts. For gender and compensation, the results revealed that there was a significant difference between female and male managers in the level of importance attributed to compensation from management.. Regarding salary earned and compensation, there was a significant difference between higher earning and lower earning managers in the level of importance attributed to compensation from management Conclusion, limitations and recommendations: The respondents showed general satisfaction when it came to the rewards offered in the organisation. The results of the study revealed that rewards do motivate employees, especially in making decisions whether to stay with the company or not. The employees were very satisfied with the rewards that they received in the organisation. A major limitation of this study is that the research was only conducted in one organisation and therefore, given the diversity of companies in the retail industry, the results cannot be generalised to all organisations and other industries. In future, research should be conducted on a larger scale including more organisations within the same sector as well as across sectors so that comparisons can be made which can also be used for benchmarking. Contribution/value-add: This study has attempted to add to the body of knowledge in terms of understanding the role that rewards play in motivating managers and how these can change their behaviour in the course of achieving company objectives. The study also examined the relevant rewards perceived to be motivators by both junior and middle managers in a company.

Collective bargaining was impacted by the confrontation at Marakina and the role players, employers and unions were left looking for new creative alternatives to reward operational employees (blue collar workers).Then, finding a well-designed pay system is crucial for the success of the organisation, since collective bargaining is under pressure. The following determinants, job based pay, performance based pay, skills based pay, education and training, and tenure based pay were constructed from literature to formulate the conceptual model for the pay of operators in the manufacturing sector of Port Elizabeth. There are a number of factors that are at play in the determination and design of pay systems, which need to be considered. Two major pay systems are at the centre of this study and they are those based on the worth of the job and those that are based on employees’ skills, productivity, education and training, and tenure. Pay equity is at the heart of employment relationship and is the reference point with regard to the distribution of resources when economic productivity and profitability are achieved. The findings presented indicated that all the determinants, job based pay, performance based pay, skills based pay and education and training, with the exception of tenure based pay, were significant to the pay of operational employees. However, the multivariable regression model found that job based pay is more significant and should be modelled as the foundation of the pay system for operational employees. Other pay determinants, such as performance and skills based pay are best modelled as additional increments that accelerate employees’ pay.

Numerous researchers, employing theories from either psychology or economics, have investigated the circumstances under which firms are likely to adopt salary-based versus commission-based compensation plans. This study integrates the most common theoretical bases of salesperson compensation literature into a broad framework labeled the Eclectic Paradigm of Salesperson Compensation (EPSC). The EPSC proposes that there is a positive association between a firm's salary orientation and resource commitment, and a firm's salary orientation and firm control. There should be a negative association between salary orientation and dissemination risk, and salary orientation and salesperson motivation/performance. Twenty-three hypotheses originating from the EPSC were tested using a pretest sample of 48 real estate salespersons and a test sample of 311 real estate salespersons. The data were analyzed using common factor analysis, logistic regression, multivariate analysis of variance, and median tests. Of the 23 hypotheses, 10 were supported, 7 were partially supported, and 6 were not supported. The results suggest that the eclectic paradigm of salesperson compensation is a promising initial step toward developing a comprehensive model for understanding the determinants of salary versus commission.