Working Paper No. 611

The Effects of Internationalization on CEO Compensation

Published: February 9, 2004; Published in Journal of International Business Studies, 2005, Vol. 36, No. 4, pp. 470-483Pages: 26Keywords: CEO Compensation; Internationalization; Corporate Governance; CEO Tenure; Cross-Listing; Foreign Board Membership JEL-codes: G34; K12; M10; M12

The Effects of Internationalization on CEO Compensation Lars Oxelheim and Trond Randøy


This study examines the relation between the internationalization of firms and CEO compensation. Starting from a sample of Norwegian and Swedish listed firms we analyze the effects of internationalization as manifest in the capital market (international cross-listing), the market for corporate control (foreign board membership), and the product and service market (export and foreign sales). We conclude that all three markets contribute positively to the compensation level of CEOs. We argue that part of the higher CEO compensation in internationally oriented firms - as compared to less internationalized firms within the same country - reflects a risk premium for reduction in job security.

 

Lars Oxelheim

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lars.oxelheim@ifn.se

Interdisciplinary European Studies

The European Union in a Changing World Order

Pages-from-2019-Oxelheim-m.gif

This book explores how the European Union responds to the ongoing challenges to the liberal international order. These challenges arise both within the EU itself and beyond its borders, and put into question the values of free trade and liberal democracy. 

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