Community and Compensation: Director Remuneration in Thailand

Pornanong Budsaratragoon, Suntharee Lhaopadchan, Steen Thomsen

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We propose a new theoretical perspective based on mimesis (peer group imitation) to explain non-executive director pay. Arguing that peer group effects may be reinforced by Thai business culture, we test and support our hypothesis on a sample of 523 listed Thai companies from 2010 to 2015. We find that peer group pay is by far the most important and robust determinant of director pay in our sample. Simple peer effects explain almost half of the variation in director pay, and director pay converges to the peer group level over time. A discontinuity regression – a jump in director pay observed when companies are admitted to the SET50 stock market index – indicates a causal effect from peer group pay to director pay.
Original languageEnglish
Article number101124
JournalResearch in International Business and Finance
Number of pages19
Publication statusPublished - Apr 2020


  • Director compensation
  • Peer group effects
  • Agency theory
  • Managerial power

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