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Revitalizing Organizational Efficiency: Unpacking the Relationship between CEO Turnover, Research and Development, and Pay-Performance Sensitivities in the Financial Sector of Pakistan

Author

Listed:
  • Xiaoyu Yin

    (School of Economics and Finance, Xi’an Jiaotong University, Xi’an 710061, China)

  • Xiujian Wei

    (School of Economics and Finance, Xi’an Jiaotong University, Xi’an 710061, China)

  • Muhammad Irfan

    (Institute of Banking and Finance, Bahauddin Zakariya University, Multan 60800, Pakistan)

  • Sonia Yasin

    (Institute of Banking and Finance, Bahauddin Zakariya University, Multan 60800, Pakistan)

Abstract

This study examines the relationship between senior management turnover, wage structures, and organizational efficiency in the banking industry in Pakistan. Using secondary panel data from annual reports of commercial banks and multiple regression techniques, the study finds that pay-performance sensitivity, R&D investment, and firm age positively impact organizational efficiency. At the same time, higher expense ratios are negatively associated with efficiency. CEO turnover, duality, and board size have a relatively low impact on efficiency. This study provides valuable insights for managers and policymakers in the banking sector, highlighting key areas that should be prioritized to improve efficiency, reduce costs, and increase financial performance. By offering a roadmap for decision-makers to focus their efforts, this study provides a valuable framework for achieving tremendous success in the banking industry.

Suggested Citation

  • Xiaoyu Yin & Xiujian Wei & Muhammad Irfan & Sonia Yasin, 2023. "Revitalizing Organizational Efficiency: Unpacking the Relationship between CEO Turnover, Research and Development, and Pay-Performance Sensitivities in the Financial Sector of Pakistan," Sustainability, MDPI, vol. 15(13), pages 1-15, July.
    • Handle: RePEc:gam:jsusta:v:15:y:2023:i:13:p:10578-:d:1187378
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    References listed on IDEAS

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