An archetypical analysis of chief executive officers in the mining sector according to their remuneration and company performance: a resource based view
- Authors: King, Matthew Sebastian
- Date: 2020
- Subjects: Executives -- Salaries, etc. -- South Africa , Directors of corporations -- Salaries, etc. -- South Africa , Mining corporations -- Salaries, etc. -- South Africa , Mines and mineral resources -- Management
- Language: English
- Type: text , Thesis , Masters , MBA
- Identifier: http://hdl.handle.net/10962/168503 , vital:41589
- Description: The growth in the mining sector post 1994 saw many CEO s enjoy exorbitant levels of financial prosperity particularly in relation to th e mining workforce . The pay disparity between the remuneration of CEO s and the average worker contributed to instability and labour unrest. While there has been extensive research conducted on the relationship between CEO remuneration and company performance, questions around the justification of exorbitant CEO remuneration levels have persisted. One of the shortcomings of these studies have been understanding company performance as limited to financial indicators. For this reason, Resource - Based theory was used in this study to focus on CEOs as tangible, heterogeneous and immobile assets, who could influence company performance by creating a firm’s competitive advantage. In order to investigate this, a mixed - method research design was utilised to ascertain the relationship between CEO remune ration and company performance. The data for the quantitative study was collected using an archival method by sourcing secondary data obtained from the sampled companie s’ annual integrated reports. Statistical tests were performed to test the relationsh ip between CEO remuneration and company performance of mining companies listed on the JSE over the period of 2014 to 2018. This was followed by the qualitative thematic analysis which utilised online information published about four CEOs sampled according to their pay/performance relationships (namely high earning/high performing; high earning/low performing; low earning/high performing and low earning/low performing). The VRIO framework was utilised in conjunction with the thematic analysis to assess the extent to which each of the selected CEOs could be identified as valuable, rare, inimitable and organised. Finally, t he demographic characteristics and leadership attributes of these CEOs were collectiv ely aligned to particular l eadership archetype s. This study found that despite company performance levels experiencing negative growth and volatility, CEO remuneration remained stable and experienced positive growth throughout the period . The qualitative analysis and the application of the VRIO framework wa s conducted in order to explor e reasons why this disparity may continue to exist. The analysis of the differences in demographic characteristics and leadership attributes between these four CEOs provided a possible j ustification for the disparity in t he levels of remuneration. It was found that some CEOs high levels of remuneration could be justified by virtue of their well - developed leadership skills. In particular CEOs need softer skills (such as communication, openness, relationship - building and stakeholder engagement) and to draw on the communicator, builder and coach archetypes in order to create a sustained competitive advantage within companies.
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- Date Issued: 2020
Share incentive schemes in South Africa : an analysis of company law, accounting and income tax implications
- Authors: Mentz, Melanie
- Date: 2013
- Subjects: Executives -- Salaries, etc. -- South Africa , Bonuses (Employee fringe benefits) -- South Africa
- Language: English
- Type: Thesis , Masters , MCom
- Identifier: vital:8969 , http://hdl.handle.net/10948/d1021109
- Description: In the last decade South Africa saw the introduction of s 8C into the Income Tax Act, no.58 of 1962, the introduction of IFRS 2 into the International Financial Reporting Standards and the promulgation of the 2008 Companies Act. Each of these changes is relevant to and impact on the consequences flowing from executive share incentive schemes, from the perspective of both the employer company offering the scheme and the employee participating in the scheme. The aim of this study was to analyse, from the employer company’s perspective, the implications of each discipline in isolation, as well as the interrelationship of the three disciplines. The further aims of this study were to utilise the findings from the analyses to identify where legislative amendment is required to close loopholes or ensure equitable results, to identify where the interrelationship of the three disciplines result in unintended consequences, and to provide recommendations on how to avoid these adverse consequences. The most significant findings of this study are summarised below. Due to the legal precedent created by the Supreme Court of Appeal in the Labat case, the mode of settlement – cash or equity – will be the determining factor as regards the availability of an income tax deduction in the hands of the employer company. It is submitted that legislative amendment is required to rectify this inequitable result. Where payment by the employer pursuant to a share appreciation rights scheme occurs in a year of assessment subsequent to the year of assessment in which vesting occurred, changes in the value of the underlying equity instrument from the vesting date to the payment date could result in adverse income tax consequences to the employer and/or the fiscus. To address this, it is recommended that the Income Tax Act should be amended to expressly bring cash-settled executive share incentive schemes within the scope of s 7B and to align the provisions of s 7B and 8C in order to avoid anomalies existing between these two sections in so far as the income tax consequences in the hands of the participating employees are concerned.
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- Date Issued: 2013