Executive Compensation Structure and Firm Value: An Analysis of Cash vs. Equity-Based Pay: An Empirical Analysis Based on the Technology Industry

DOI

10.2991/978-94-6463-835-6_27How to use a DOI?

Keywords

Executive compensation; Cash compensation; Equity compensation; Firm value; Tobin’s Q

Abstract

This paper investigates the impact of executive compensation structure (cash-based versus equity-based compensation) on corporate value, with a specific focus on the high-tech industry. Utilizing financial data from four listed companies (AAPL, DELL, HPQ, and SMCI) between 2019 and 2023, the study employs Tobin’s Q as a proxy for corporate value and examines compensation effects through multiple regression analysis. The results demonstrate that equity-based compensation exerts a statistically significant positive influence on corporate value, whereas cash-based compensation shows no measurable effect. These findings suggest that long-term incentive mechanisms effectively enhance executive motivation and corporate value, while excessive reliance on cash compensation may fail to align managerial interests with shareholder objectives. Although existing literature extensively explores executive compensation, research gaps persist regarding how industry characteristics and corporate governance structures moderate incentive effectiveness. The study provides empirical evidence for optimizing executive compensation policies and highlights the need for comparative investigations into industry-specific compensation structures. This work contributes to understanding the differential impacts of compensation components in technology-driven sectors and proposes directions for future research on incentive mechanism design under varying governance frameworks.

Copyright

© 2025 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Ziying Wei
PY  - 2025
DA  - 2025/09/17
TI  - Executive Compensation Structure and Firm Value: An Analysis of Cash vs. Equity-Based Pay: An Empirical Analysis Based on the Technology Industry
BT  - Proceedings of the 2025 3rd International Academic Conference on Management Innovation and Economic Development (MIED 2025)
PB  - Atlantis Press
SP  - 249
EP  - 256
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-835-6_27
DO  - 10.2991/978-94-6463-835-6_27
ID  - Wei2025
ER  -