The papers in this volume and briefly summarized in this introduction document
Management compensation and related issues of corporate governance have
become major topics of discussion in the media and in the political and regulatory
sectors. Unfortunately, there is much confusion and misinformation about these
topics. For example, an extreme view that has received considerable attention holds
that executives do not act in their shareholders’ interests and that they control their
boards of directors. It is asserted that executives are paid too much, that executives’
pay is independent of the performance of their firms, and that executives do not lose
their jobs for poor performance. The conference papers and discussion did not address
the level of executive pay. With this exception, the conference papers provide
evidence these beliefs are incorrect.