SSRN-Executive Compensation, Compensation Consultants, and Shopping for Opinion: Evidence from the UK

Many of you may have noticed that the ECE has started posting links to academic documents, when we find them.  While these documents are not always easy to read, they provide an insight into our world that is difficult to have as an industry insider.  If you have the time, I recommend checking these out.  You can find them by going to "Communicate" then select "Discussions", then select the last forum "Academic Research".

SUMMARY

SSRN-Executive Compensation, Compensation Consultants, and Shopping for Opinion: Evidence from the UK by Lisa Goh, Aditi Gupta http://bit.ly/d4fCoX

5. Conclusions
In this study we contribute to the existing literature on compensation consultants
and executive pay, and contribute new findings on consultant-switching, using a large panel of CEO and executive director data from the FTSE 350. 
Consistent with prior research, we first find that all components of executive
compensation (salary, bonus, equity and total pay) are higher in firms using consultants, after controlling for firm and director characteristics, and the proportion of equity compensation (salary) used in the compensation package is higher (lower) in firms that use consultants (see Appendices 1 and 2).
We contribute new findings on the use of consultants, by examining consultant
switching and contemporaneous changes in compensation levels and composition. We find that firms that switch their main consultant during the year have higher increases in salary than non-switching firms (even after adjusting for peer group changes), providing

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