Abstract We posit that information about CEO pay ratios is important to investors because employees' perceived fairness of their firm’s CEO pay ratio has consequences for firm performance. We use path analysis to examine the association between firm performance and (1) the predicted CEO pay ratio as determined by economic factors (the fair component of CEO pay ratio) and (2) the predicted CEO pay ratio as determined by non-economic factors (the unfair component of CEO pay ratio). We test for the existence and relative importance of direct and indirect paths using two measures of employee satisfaction and two measures of firm performance. We find that pay equity, a larger CEO pay ratio driven by economic factors, is associated with employee contributions to better firm performance. Conversely, we show that pay inequity, a larger CEO pay ratio driven by non-economic factors, is associated with employees' contributions to poorer firm performance. Consistent with the view that managerial entrenchment may amplify the negative effects of the CEO pay ratio, we find that the negative indirect path between pay inequity and firm performance, mediated by employee satisfaction, is more pronounced in firms with entrenched CEOs. Our findings contribute to the accounting compensation literature because they are consistent with CEO pay ratio information having economic consequences.

中文翻译：

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员工满意度介导的CEO薪酬比率与公司绩效之间关系的路径分析研究

摘要我们认为关于CEO薪酬比率的信息对投资者很重要，因为员工对公司CEO薪酬比率的公平感会影响公司的绩效。我们使用路径分析来检查公司绩效与（1）由经济因素（CEO薪酬比率的公平组成部分）确定的预计CEO薪酬比率和（2）由非经济因素确定的CEO预期薪酬比率之间的关联。 （首席执行官薪酬比率的不公平部分）。我们使用两种员工满意度度量和两种企业绩效度量来测试直接路径和间接路径的存在和相对重要性。我们发现，薪酬权益是受经济因素驱动的更大的CEO薪酬比率，与员工为改善公司绩效所做的贡献有关。相反，我们表明工资不平等，由非经济因素驱动的更大的CEO薪酬比率与员工对公司绩效较差的贡献有关。一致认为，管理者根深蒂固可能会放大CEO薪酬比率的负面影响，我们发现在雇员根深蒂固的公司中，薪酬不平等与公司绩效之间的负间接路径在员工满意度的介导下更为明显。我们的发现有助于会计补偿文献，因为它们与具有经济后果的CEO薪酬比率信息相一致。在员工根深蒂固的公司中，员工满意度的中介作用更为明显。我们的发现有助于会计补偿文献，因为它们与具有经济后果的CEO薪酬比率信息相一致。在员工根深蒂固的公司中，员工满意度的中介作用更为明显。我们的发现有助于会计补偿文献，因为它们与具有经济后果的CEO薪酬比率信息相一致。