Abstract:

The dominance of Western-led management theories has shaped executive compensation practices, driving a global trend towards greater homogeneity (Chrisman and William, 1994, 243; Frenkel and Shenhav, 2003). This is reflected in the perceived legitimacy and assumed generalisability of ‘best practice’ (Smith and Meiksins, 1995; Frenkel and Shenhav, 2003; 2006), which has arisen from this trend towards uniformity (Baeten et al., 2011). However, these dominant ideas are under-contextualised (Rousseau and Fried, 2001; Cooke, 2017) and do not account for the influence of institutional, cultural, and contextual differences, which vary in relevance across locations. Using a critical realist epistemology, our study analyses interview data from thirty-six executives in two international financial centres, Hong Kong and the United Kingdom, to explore the institutional factors influencing executive compensation reforms after the 2008 global financial crisis. The data reveal that the interrelationships between contextual factors at the macro and micro levels differ in their instrumentality across locations. This results in stark, context-specific differences in the implementation of executive compensation reforms. The findings question the assumed universality of ‘best practice’ (Beer and Katz, 2003). This research also advocates greater contextualisation in international business research (Welch et al., 2011; Cooke, 2017) and more integrated explanations within the international HRM literature (Edwards et al., 2016; 2020; Schotter et al., 2021).

Please choose your submission type: Full Paper

Primary Track: Corporate Governance

Keywords: External Corporate Governance Mechanisms ;Corporate Governance in the private sector, including family businesses ;Ownership and Board Structure ;Comparative Corporate Governance

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Dr. Robert Amos