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AUS professors publish book on mergers and acquisitions
Dr. Virginia Bodolica and Dr. Martin Spraggon-Hernandez, Professors of Management in the School of Business Administration at AUS, have published a book entitled Mergers and Acquisitions and Executive Compensation with Routledge (Taylor & Francis Group). The book, which is part of Routledge Studies in Corporate Governance, was launched at the 75th Academy of Management Annual Conference in Vancouver, Canada.
Over the past decades, the total value of executive compensation packages has been rising dramatically, contributing to a wider pay gap between the chief executive officer (CEO) and the average worker. Mergers and acquisitions (M&As) constitute major examples of high-profile events prompted by managers who typically conceive them as a means for achieving higher levels of pay, even though they are frequently associated with disappointing returns to acquiring shareholders. In their book, Bodolica and Spraggon-Hernandez provide a compelling argument for an advanced, combined analysis of two recently growing and very impactful trends, namely M&As and executive compensation.
According to Dr. Duncan Angwin, a Professor and M&A Specialist at Oxford Brookes University, UK, "This book provides an excellent review of a crucial, contemporary issue in M&As and corporate governance, namely, are CEOs motivated to transact M&A deals just to maximize their own compensation, or act purely in shareholders' best interests. With billions of dollars at stake for companies and economies, the motivation of CEOs to do these deals matters. This book provides clear insights into how value may be created and destroyed through CEO compensation."
Performing many comparative cross-country analyses to account for the peculiarities of national corporate governance regimes, the book is addressed to those who are interested in studying phenomena associated with the effectiveness of internal and external governance arrangements in today's corporate world. In particular, it seeks to advance readers' understanding of the strategic value of the CEO compensation setting processes around M&A transactions. Corporate governance practitioners and members of boards of directors, who approve M&A deals and are responsible for determining the incentive design of executive pay packages, may find the book informative for enhancing the efficacy of their decision making processes.
Dr. Ashraf Gamal, the CEO of Hawkamah, The Institute for Corporate Governance located in Dubai notes, "In today's fast moving business world, M&As are common options for business expansion. Boards are reviewing compensation systems to reward the right behavior and encourage executives to achieve corporate objectives without incurring higher risk than the board approves. The relationship between M&As and CEO remuneration is an important area of research that can add a lot of value to governance scholars and practitioners."