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This paper aims to empirically examine the moderating role of ESG disclosure while determining performance-based CEO pay.The compensation pay given to the CEOs must be linked to corporate sustainability so as to motivate them to act towards non-economic goals vis-à-vis earning profits.A total of 67 companies listed in the NSE Nifty 100 ESG index spanning six years from 2014 to 2019 have been taken as the panel data sample.As a baseline methodology, the PCSE model is applied and further two-step system GMM model has been considered for robustness check.The findings reveal that ESG disclosure scores show a significant positive effect in moderating the CEO pay-performance relationship.Stand-alone ESG measures indicate that except for social disclosure scores, all the other indicators depict a significant impact in determining the effect of firm performance on CEO pay.This study implies consideration of non-financial performance measures while determining CEO Pay.
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Deo et al. (2023) studied this question.
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