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Perceptions Of Benevolence And The Design Of Agency Contracts: Ceo-tmt Relationships In Family Firms

Perceptions of benevolence and the design of agency contracts: CEO-TMT relationships in family firms

Author(s)

Authors: Cristina Cruz, LR Gómez-Mejia, M Becerra

Organization

Academy of Management Journal 53 (1), 69-89

Publication

Academy of Management

Publication Type

Academic Research

Using a sample of 122 Spanish family-owned firms , we analyzed the determinants and consequences of the presence of trust in executive contracts in family firms. Our findings proved that high level of trust of the CEO in the Top Management Team reduces the pay-performance sensitivity of executive compensation for both, family and nonfamily executives although the effect is stronger for the former than for the latter.

IE UNIVERSITY