Issues associated with chief executive officer remuneration: shareholders' perspectives

In Australia, executive remuneration has received extensive press coverage as well as considerable academic consideration. Anecdotal evidence suggests that the public is concerned with the level of remuneration given to executive officers. The authors examine the attitudes and views of individual shareholders on agency costs and disclosure issues pertaining to the remuneration of executive officers of Australian public companies. The results of the authors' empirical investigation suggest that shareholders are seeking more transparency in relation to the determining of executive officer remuneration. The results suggest support for the use of remuneration committees, comprehensive disclosure in Annual Reports and disclosure of achievements against performance targets in a broad and transparent disclosure regime. Despite the empirical investigation being undertaken prior to the Company Law Review Act 1998 (Cth), the results of the research suggest shareholders would support the disclosure regime that was put in place by the Company Law Review Act 1998