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The role of CEOs in the sustainability of defined benefit pension plans
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Horton, Joanne, Kiosse, P. V., Koumenta, M. and Mitrou, E. (2021) The role of CEOs in the sustainability of defined benefit pension plans. Human Resource Management Journal, 31 (3). pp. 603-618. doi:10.1111/1748-8583.12329
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Official URL: https://doi.org/10.1111/1748-8583.12329
Abstract
The future of defined benefit (DB) pensions is a hotly debated topic in reward management. Drawing on agency and managerial power theories, the conditions under which CEOs can affect their sustainability have been examined. We show that when the CEO is a member of the same DB plan as their employees or when the CEO is both a member and a trustee of the plan, this affects the agency and power dynamics increasing the likelihood of these plans being retained. To address endogeneity concerns, we mimic randomisation using propensity score matching and the results continue to hold. Using the introduction of pension tax penalties as an exogenous shock on CEO self‐interest, we find that it affects the propensity of DB plan closures. The study highlights the key role that CEO incentives play on pension–provision decisions and indicates how HR practitioners/regulators can harness CEO self‐interest to safeguard the sustainability of DB pension plans.
| Item Type: | Journal Article | ||||||||
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| Subjects: | H Social Sciences > HD Industries. Land use. Labor H Social Sciences > HF Commerce |
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| Divisions: | Faculty of Social Sciences > Warwick Business School > Accounting Faculty of Social Sciences > Warwick Business School |
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| Library of Congress Subject Headings (LCSH): | Defined benefit pension plans , Chief executive officers, Chief executive officers -- Salaries, etc, Incentives in industry, Conflict of interests | ||||||||
| Journal or Publication Title: | Human Resource Management Journal | ||||||||
| Publisher: | Wiley-Blackwell Publishing Ltd. | ||||||||
| ISSN: | 0954-5395 | ||||||||
| Official Date: | July 2021 | ||||||||
| Dates: |
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| Volume: | 31 | ||||||||
| Number: | 3 | ||||||||
| Page Range: | pp. 603-618 | ||||||||
| DOI: | 10.1111/1748-8583.12329 | ||||||||
| Status: | Peer Reviewed | ||||||||
| Publication Status: | Published | ||||||||
| Publisher Statement: | This is the peer reviewed version of the following article: [FULL CITE], which has been published in final form at [Link to final article using the DOI]. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Use of Self-Archived Versions. | ||||||||
| Access rights to Published version: | Open Access | ||||||||
| Copyright Holders: | © 2020 The Authors. Human Resource Management Journal published by John Wiley & Sons Ltd. | ||||||||
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