Managers’ Compensation in Large Public Firms in Belgium: An Analysis on the BEL 20


  • Jonathan BAUWERAERTS University of Mons
  • Julien VANDERNOOT University of Mons
  • Thomas TYRANT University of Mons


compensation, chief executive officer, corporate governance, performance, top management team


Agency theory predicts that incentive compensation aligns management interests with those of shareholders, and that CEO pay is a solution to the agency costs arising from the separation of ownership and management. Amongst corporate governance literature, several researchers have focused on executive compensation and its link with firm performance. International studies document evidence that CEO remuneration is positively correlated with corporate performance and firm size. Applying Generalized Method of Moments (GMM) estimator to a sample of BEL-20 Index firms for the years 2004 to 2010, this article examines the association between remuneration — both of CEOs and top management teams — and variables such as size, performance, CEO characteristics and “corporate governance” structure. Our results document a CEO pay-size association as positive and statistically significant, and a positive weak relation between CEO compensation and performance.