Determinants of top management compensation: The case of NCAA football head coaches

Abstract

Scope and Method of Study: This dissertation examined National Collegiate Athletic Association Football Bowl Subdivision head football coach's contracts to investigate the determinants of both maximum compensation and guaranteed compensation. These relationships can lead to a better understanding of top corporate executive compensation packages. This study offers discernment into the configuration of NCAA FBS head coach's contracts and delivers insight into salary structure, performance incentives, nonperformance incentives (perquisites), and termination and buyout agreements found within these contracts.

Findings and Conclusions: Results indicate maximum compensation is positively related to the performance of a university's football program and the head football coach. This supports corporate compensation studies that find executive compensation to be positive and significantly related to the performance of a firm. Results also indicate maximum compensation and guaranteed compensation is positively related to career and university tenure. Further, maximum compensation is found to be positively and significantly related to size, however guaranteed compensation is not significantly related to size.