© 2019

Agency Theory and Executive Pay

The Remuneration Committee's Dilemma


Table of contents

  1. Front Matter
    Pages i-xi
  2. Alexander Pepper
    Pages 15-42
  3. Alexander Pepper
    Pages 43-76
  4. Alexander Pepper
    Pages 77-99
  5. Alexander Pepper
    Pages 101-116
  6. Alexander Pepper
    Pages 117-126
  7. Back Matter
    Pages 127-133

About this book


This new book examines the relationship between agency theory and executive pay. It argues that while Jensen and Meckling (1976) were right in their analysis of the agency problem in public corporations they were wrong about the proposed solutions. Drawing on ideas from economics, psychology, sociology and the philosophy of science, the author explains  how standard agency theory has contributed to the problem of executive pay rather than solved it. The book explores why companies should be regarded as real entities not legal fictions, how executive pay in public corporations can be conceptualised as a collective action problem and how behavioural science can help in the design of optimal incentive arrangements. An insightful and revolutionary read for those researching corporate governance, HRM and organisation theory, this useful book offers potential solutions to some of the problems with executive pay and the standard model of agency.


Executive reward Reward systems organization theory Senior Executive Pay Executive Compensation collective action problem public corporation

Authors and affiliations

  1. 1.Department of ManagementLondon School of Economics and Political ScienceLondonUK

About the authors

Alexander Pepper is Professor of Management Practice at the London School of Economics and Political Science, UK.  He previously had a long career at PwC, where he was a global leader of PwC’s Human Resource Services consulting practice from 2002-2006.  He has authored two books, Senior Executive Reward (2006), and The Economic Psychology of Incentives published by Palgrave Macmillan in 2015.

Bibliographic information

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