The impact of institutional complexity and top management characteristics on executive compensation and firm performance

While most studies take a dyadic view when examining the environmental difference between the home country of a multinational enterprise (MNE) and a particular foreign country, they ignore that an MNE is managing a network of subsidiaries embedded in diverse environments. Additionally, neither the impacts of global environments on top executives nor the effects of top executives’ capabilities to handle institutional complexity are fully explored. Thus, using a three-essay format, this dissertation tried to fill these gaps by addressing the effects of institutional complexity and top management characteristics on top executive compensation and firm performance. ^ Essay 1 investigated the impact of an MNE’s institutional complexity, or the diversity of national institutions facing an MNE’s network of subsidiaries, on the top management team (TMT) compensation. This essay proposed that greater political and cultural complexity leads to not only greater TMT total compensation but also to a greater portion of TMT compensation linked with long-term performance. The arguments are supported in this essay by using an unbalanced panel dataset including 296 U.S. firms with 1,340 observations. ^ Essay 2 explored TMT social capital and its moderating role on value creation and appropriation by the chief executive officer (CEO). Using a sample with 548 U.S. firms and 2,010 observations, it found that greater TMT social capital does facilitate the effects of CEO intellectual capital and social capital on firm growth. Finally, essay 3 examined the performance implications for the fit between managerial information-processing capabilities and institutional complexity. It proposed that institutional complexity is associated with the needs of information-processing. On the other hand, smaller TMT turnover and larger TMT size reflect larger managerial information-processing capabilities. Consequently, superior performance is achieved by the match among institutional complexity, TMT turnover, and TMT size. All hypotheses in essay 3 are supported in a sample of 301 U.S. firms and 1,404 observations. ^ To conclude, this dissertation advances and extends our knowledge on the roles of institutional environments and top executives on firm performance and top executive compensation.^

The impact of CEO compensation and CEO horizon on a firm's discretionary research and development expenditures

Agency costs are said to arise as a result of the separation of ownership from control inherent in the corporate form of ownership. One such agency problem concerns the potential variance between the time horizons of principal shareholders and agent managers. Agency theory suggests that these costs can be alleviated or controlled through performance-based Chief Executive Officer (CEO) contracting. However, components of a CEO's compensation contract can exacerbate or mitigate agency-related problems (Antle and Smith, 1985). According to the horizon hypothesis, a self-serving CEO reduces discretionary research and development (R&D) expenditures to increase earnings and earnings-based bonus compensation. Agency theorists contend that a CEO's market-based compensation component can mitigate horizon problems. This study seeks to determine whether there is a relationship between CEO earnings- and market-based compensation components and R&D expenditures in the largest United States industrial firms from 1987 to 1993.^ Consistent with the horizon hypothesis, results provide evidence of a negative and statistically significant relationship between CEO cash compensation (i.e., salary and bonus) and the firm's R&D expenditures. Consistent with the expectations of agency theory, results provide evidence of a positive and statistically significant relationship between market-based CEO compensation and R&D.^ Further results of this study provide evidence of a positive and statistically significant relationship between CEO tenure and the firm's R&D expenditures. Although there is a negative relationship between CEO age and the firm's R&D, it was not statistically significant at the 0.5 level. ^

Associations between SOX 404 opinions and auditors, audit committees, and executives

This dissertation examined three issues associated with Section 404 of the Sarbanes-Oxley Act (SOX) that are of current interest to regulators and the accounting profession. For the first essay, I examined auditor changes from 2003 to 2005 for 2,454 non-financial firms that filed their initial SOX 404 opinions prior to July 1, 2005. My results showed that there is a significant association between the receipt of an adverse SOX 404 opinion and auditor resignations - both before and after the issuance of the SOX 404 opinion. The data related to auditor dismissals show that clients are not successful in opinion shopping, since clients dismissing the auditor before the SOX 404 report also are more likely to receive an adverse SOX 404 opinion than clients not changing auditors. My second essay examined the relation between audit committee characteristics and changes in material weaknesses in internal control over financial reporting under the new SOX regime. My results showed that improvements in internal control in the second year of SOX are associated with: (1) the number of audit committee members and (2) financial expertise of audit committee members. My third essay examined the relation between the appointment of the new executives and the subsequent receipt of initial section 404 of SOX opinions. My results showed that adverse SOX 404 reports will be more likely at firms that recently hired a new chief financial officer (CFO).

2011-2012 Worlds Ahead Strategic Plan Implementation

2011-12 Worlds Ahead Strategic Plan Implementation Forum, held at Biscayne Bay Campus. Speakers included President Mark B. Rosenberg and Chief Financial Officer Ken Jessell.

Assessing an automated, information -sharing technology in the post "9 -11" era: Do local law enforcement officers think it meets their needs?

In the wake of the “9-11” terrorists' attacks, the U.S. Government has turned to information technology (IT) to address a lack of information sharing among law enforcement agencies. This research determined if and how information-sharing technology helps law enforcement by examining the differences in perception of the value of IT between law enforcement officers who have access to automated regional information sharing and those who do not. It also examined the effect of potential intervening variables such as user characteristics, training, and experience, on the officers' evaluation of IT. The sample was limited to 588 officers from two sheriff's offices; one of them (the study group) uses information sharing technology, the other (the comparison group) does not. Triangulated methodologies included surveys, interviews, direct observation, and a review of agency records. Data analysis involved the following statistical methods: descriptive statistics, Chi-Square, factor analysis, principal component analysis, Cronbach's Alpha, Mann-Whitney tests, analysis of variance (ANOVA), and Scheffe' post hoc analysis. ^ Results indicated a significant difference between groups: the study group perceived information sharing technology as being a greater factor in solving crime and in increasing officer productivity. The study group was more satisfied with the data available to it. As to the number of arrests made, information sharing technology did not make a difference. Analysis of the potential intervening variables revealed several remarkable results. The presence of a strong performance management imperative (in the comparison sheriff's office) appeared to be a factor in case clearances and arrests, technology notwithstanding. As to the influence of user characteristics, level of education did not influence a user's satisfaction with technology, but user-satisfaction scores differed significantly among years of experience as a law enforcement officer and the amount of computer training, suggesting a significant but weak relationship. ^ Therefore, this study finds that information sharing technology assists law enforcement officers in doing their jobs. It also suggests that other variables such as computer training, experience, and management climate should be accounted for when assessing the impact of information technology. ^