Inside the family firms: The impact of family and institutional ownership on executive remuneration

Figures & data

Table 1. Descriptive statistics

Variable	Mean	Median	Std. Dev.	Min.	Max.
Dependent variable
exrem (RM in million)	3.413	1.899	6.596	0.005	126.768
Independent variables
dio (%)	10.979	8.439	10.234	0.00	57.330
fio (%)	4.530	1.231	7.171	0.000	41.570
fo (%)	47.425	47.360	13.644	20.110	88.720
Control variables
bs	7.599	7.000	1.772	4.000	13.000
ta (RM in billion)	1.249	0.351	4.408	0.021	60.600
lev (%)	37.412	36.244	19.711	2.080	189.430
roa(−1) (%)	5.731	5.090	6.714	(26.730)	57.180
mv (%)	95.524	70.000	93.427	(18.000)	1243.000

Legend: exrem is the total remuneration received by the executive directors; dio is domestic institutional ownership; fio is the foreign institutional ownership; fo is the family ownership; bs is the board size, ta is the total assets, lev is the ratio of total debts to total assets, roa(−1) is lagged return on assets, mv is the ratio of market value to book value of equity.

Table 2. Panel regression results using FEM with robust standard errors estimation

Variable	Panel A	Panel B	Panel C
dio	−0.355	−0.584**	−1.348**
fio	0.231	0.016	−1.559*
fo	0.843***	0.078	0.620
bs	0.058***	0.053***	0.078**
lnta	0.539***	0.549***	0.939***
lev	−0.081	−0.067	−1.049*
roa(−1)	0.002	0.002	−0.004
mv	0.065***	0.064**	0.245***
constant	6.636***	6.947***	1.868
Overall R^2	0.341	0.342	0.327
No. of observations	1395	1395	129

Legend: Panel regression model is run under three different scenarios: Panel A shows the regression results where the fo is measured by the total family ownership; Panel B shows the regression results where the fo is measured by the managerial ownership held by the family directors on board; and Panel C shows the regression results for the subsample firms that have a non-family CEO. The dependent variable under all of the scenarios is the natural logarithm of executive remuneration (lnexrem). dio is the domestic institutional ownership, fio is the foreign institutional ownership, fo is the family ownership, bs is the board size, lnta is the natural logarithm of the total assets, lev is the ratio of total debts to total assets, roa(−1) is lagged return on assets, mv is the ratio of market value to book value of equity.

^* 0.10 significance level respectively.

^** 0.05 significance level respectively.

^*** 0.01 significance level respectively.