Directors’ Remuneration's Connection with Profit and Share Price

The current study evaluates probable relationship between financial performances of the corporation and level of remuneration of key management. The study at hand assesses overall performance of business concerns with regard to profitability and its relation to management remuneration for three different Australian firms that are listed on Australian stock exchange (ASX). Essentially, the current purpose of the study is to scrutinize contribution of remuneration towards financial performance of firms.

Running head: DIRECTORS’ REMUNERATION'S AND PROFIT AND SHARE PRICE
OF FIRMS
Directors’ Remuneration's Connection with Profit and Share Price
University Name
Student Name
Authors’ Note

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DIRECTORS’ REMUNERATION'S AND PROFIT AND SHARE PRICE OF FIRMS
Executive Summary
The current study evaluates probable relationship between financial performances of the
corporation and level of remuneration of key management. The study at hand assesses overall
performance of business concerns with regard to profitability and its relation to management
remuneration for three different Australian firms that are listed on Australian stock exchange
(ASX). Essentially, the current purpose of the study is to scrutinize contribution of
remuneration towards financial performance of firms. The level of profitability of firms is
reflected as share price and net profit of the firms and financial profitability is enumerated for
utilization of resource and wealth of shareholders are regarded in the study for examining the
theme.

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DIRECTORS’ REMUNERATION'S AND PROFIT AND SHARE PRICE OF FIRMS
Table of Contents
Chapter 1: INTRODUCTION....................................................................................................5
1.1 Introduction......................................................................................................................5
1.2 Research Background.......................................................................................................6
1.3 Research Questions..........................................................................................................7
Chapter 2: LITERATURE REVIEW.........................................................................................8
2.1 The concepts and relations...............................................................................................8
2.1.1 Directors of companies: Roles and Responsibilities.....................................................8
2.1.2 Motivations for the directors of business organizations.............................................10
2.2 Finding the Issue............................................................................................................11
Chapter 3: RESEARCH METHODOLOGY...........................................................................11
3.1 Data Collection...............................................................................................................11
3.2 Sample Selection and Data Sources...............................................................................12
3.3 Variables........................................................................................................................12
3.3.1 Independent Variables.................................................................................................13
3.3.2 Dependent Variables...................................................................................................13
3.4 Structure of the research.................................................................................................13
Chapter 4: FINDINGS and ANALYSIS..................................................................................14
4.1 Analysis of descriptive...................................................................................................14
4.2 ANNOVA......................................................................................................................15
4.3 Correlation Analysis:.....................................................................................................18

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DIRECTORS’ REMUNERATION'S AND PROFIT AND SHARE PRICE OF FIRMS
Chapter 5: DISCUSSION.......................................................................................................20
5.1 Directors remuneration with the profit..........................................................................20
5.2 Limitations.....................................................................................................................20
5.3 Conclusion and Recommendations................................................................................21
References................................................................................................................................22
Appendix:.................................................................................................................................26
1) Raw Data..........................................................................................................................26
2) Descriptive.......................................................................................................................26
3) ANNOVA........................................................................................................................27
3) Enumeration of Correlation.............................................................................................29

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DIRECTORS’ REMUNERATION'S AND PROFIT AND SHARE PRICE OF FIRMS
Chapter 1: INTRODUCTION
1.1 Introduction
In the contemporary period, with the development of the global commercial and
business scenario, attributed mostly to phenomena like Globalisation, trade liberalisation and
technological as well as infrastructural development, more and more businesses have been
going global and exploring new markets as well as geographical regions. This in turn, has
increased the level of competition among the businesses in all types of industries, thereby
increasing the dynamics and complexities of the organizations (Tjan et al., 2012).
With time, thus, the organizational frameworks have also become more dynamic,
complex and multilateral. Most of these organizations, especially the private organizations
are mostly profit driven and are founded and run by entrepreneurs, with intention of personal
monetary and non-monetary benefits maximisation. The top tiers of the business
organizations, in a generalised framework, consisting of Directors and Executives, their
remunerations and monetary benefits are crucial aspects in the commercial framework across
the globe (Sigler & Carolina, 2011). However, the remunerations of the directors and the
dynamics in the same, depend considerably on different factors, both internal and external to
the concerned organizations with which these people are associated, and the level of
remuneration of the directors, not only have implications on their level of motivation and
intention to stay in the same, but also impacts different organizational aspects and operational
frameworks (Kaplan & Minton, 2012).
Keeping this into consideration, the concerned research tries to analyse and interpret
the relationship between the remuneration of the directors of commercial and business
organizations and the profits as well as the share price dynamics of these organizations,

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especially emphasizing on the commercial and industrial sector of one of the dominant
economies in the contemporary period, that is, the Australian economy (Huczynski et al.,
2013).
1.2 Research Background
As discussed in the above section, in the era of increasing commercial dynamics and
competition as well as increased market activities of businesses, it is of immense importance
to manage the operations of a company effectively and efficiently, in a comprehensive and
inclusive manner. Much of these managing and decision-making aspects and responsibilities
are bestowed to the managing bodies and directors of the companies, which in turn indicates
towards the immensely crucial roles which these people play in the operational frameworks
of the companies and also towards the power and level of influence of their decisions and
activities on the profitability, prosperity and long-term sustainability of the organizations, in
almost all types of industries, across the globe (Hahn &Lasfer, 2011).
The directors of the companies are either the entrepreneurs themselves or are those
who are hired by the entrepreneurs to take decisions and manage the companies on their
behalf (Foster, 2012). These people are usually highly skilled ones with considerable
experience and efficiencies in their fields, due to remaining in the industries for long periods
and a lot of the company’s profits, prospects, image and sustainability in the market depends
on their insights, decisions and problem-solving as well as managing abilities, which make
them immensely crucial assets and resources for the companies. Thus, to retain these
resources and the benefits of this human capital, the companies design lucrative remuneration
and financial benefits structures for these people (Frederick, 2011).
The remuneration structures of the executives and the directors of the business
organizations, however, are dynamic and multilateral frameworks, which keep on changing

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DIRECTORS’ REMUNERATION'S AND PROFIT AND SHARE PRICE OF FIRMS
with time as well as with the changes in the profitability, business expansion, operations and
revenue generation of the companies. The payments are also done in different forms, like that
of fixed salaries or variable dividends, depending upon the value of the profits and revenue
generation as well as the share values of the companies. Often, the directors of the companies
receive payments partially or considerably based on the share valuation of the companies or
the net revenue generation or profits earned by the same. The level of the remunerations,
received by these people, also play immensely crucial roles in motivating them or
demotivating them as well as influence their level of loyalty and efforts as well as dedication
which they put in, which in turn also reflects on the level of profit earned by the companies
and on the overall reputation, brand image and sustainability of the same. Keeping this into
consideration, the concerned research tries to focus on 20 different and reputed ASX listed
companies, currently operating in the industrial sectors of the economy of Australia, to
analyse the impacts (if any) of the remuneration of the directors of these companies on the
level of profits and share values of the same (Burns, 2016).
1.3 Research Questions
Keeping into consideration the above discussion and the aims of the concerned study,
the primary question which the research tries to address is as follows:
Does there exist any kind of relationship between the remuneration of the directors of
the companies and the level of profit as well as the share price and valuation of the concerned
companies?
The secondary questions, in this context, under the domain of the primary research
question, which the concerned research tries to explore, are as follows:
a. How do the remuneration of the directors in the organizations influence the profit levels of
the same, especially in the ASX listed companies in Australia?

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b. How does the remuneration of the directors influence the share values of concerned
companies, especially in the ASX listed companies in Australia?
c. What implications do these relations (if any), have on the overall organizational dynamics
and various organizational relationships, including those of the
Chapter 2: LITERATURE REVIEW
2.1 The concepts and relations
2.1.1 Directors of companies: Roles and Responsibilities
There remain considerable perceptions and opinions in the global scholarly works and
literary frameworks, regarding the operations of the directors of different commercial
companies and the different roles and responsibilities taken up by the same in the operational
framework of the companies. Huczynski, Buchanan& Huczynski (2013), in this context,
assert that, in most of the cases director or board of directors are appointed by the companies
or the shareholders for the purpose of running the everyday operations and affairs of the
companies. Ashkenas et al. (2015), in this context, highlight the fact, that the directors of the
business organizations, especially in the contemporary period, are responsible for a number
of crucial decision-making aspects and operations, which determine the fate of the
organizations considerably. The primary roles and responsibilities of the directors of the
business entities, in this context, as highlighted by Adams, Hermalin &Weisbach (2010), can
be seen to be as follows:
 Establishing the mission, vision and the values of the companies, thereby setting the
pace and nature of the operational frameworks, both current as well as for
development of the organizations in the future (Calabrò &Mussolino, 2013)

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 Setting up and reviewing the goals of the companies, thereby designing the company
policies in different aspects
 To evaluate the presence as well as future opportunities, threats, strengths as well as
inherent weaknesses of the operational frameworks of the companies, thereby
analysing and exploring the best strategic options for the same and coordinating
between different departments and employees of the organization for the purpose of
comprehensive and successful implementations of the properly designed strategic and
policy frameworks in the operational activities of the organizations, so as to increase
the profitability and prosperity as well as the sustainability of the companies
(Shropshire, 2010)
 The directors of the companies, as per the assertions of Frederick (2011), one of the
primary responsibilities of the director or the board of directors of any company is
that of delegation of authorities and responsibilities to the management of the
companies and also to evaluate the implementation and efficiency of the business
plans and strategies (Kylander& Stone, 2012)
 The directors of the companies are also accountable for the communication channels
of the same with different shareholders as well as stakeholders of the companies, so as
to keep the production and selling processes of the companies effectively running and
the directors promote the reputation and goodwill of the companies (Valentine&
Stewart,2013). This in turn, have considerable impacts on the reputation of the
companies in the market and their prosperity and profitability (Brown& Guo, 2010)
Thus, from the above discussion, it becomes evident that the performance of any business
organization, in any aspect, depends considerably the actions and activities of the directors of
the organizations and how motivated they remain in dedicating all their efforts and ideas for

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the purpose of the development of the concerned organizations and their profitability and
sustainability (Andrew. Keay, 2016).
2.1.2 Motivations for the directors of business organizations
There are several crucial factors, in the organizational frameworks, which motivate
the directors and executives to give their best efforts for the development of their
organizations. Some of the significant ones, in this context, are highlighted in the work of
Burns, P. (2016), to be as follows:
Success of the company- As the author argues, one of the main motivational factors
for the directors of the companies, is that of the overall success of the company, as the
reputation of the director remains directly linked with the performance of the companies and
if the companies perform well, it directly increases the welfare (monetary as well as non-
monetary) of the directors (Hahn&Lasfer, 2011).
Personal success and benefits- According to Foster (2012), the directors also have
personal reasons behind remaining motivated in giving efforts towards development of the
organizations, which include their personal missions, success and incentives, which include
both monetary and non-monetary incentives. Their wages and remunerations as well as
monetary benefits, thus, act as crucial factors behind their motivations (Tjan, Harrington&
Hsieh, 2012).
All these factors indicate towards the aspects of remuneration of the directors getting
immense attention across the globe, as the same is perceived to be motivating the directors to
work harder and more sincerely, which may have positive effects on the overall performance,
prospects and sustainability of the concerned organizations.

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2.2 Finding the Issue
As put forward by Jenter& Kanaan (2015), there remains a global notion among the
population, in general, that the CEOs and the directors of the business companies, especially
of the big and multinational ones, are extremely and extravagantly overpaid. There, however,
remain, mixed perceptions regarding these remuneration structures. Kaplan& Minton (2012),
assert that paying high remunerations to the directors of the companies can be a productive
decision, if the same leads to motivation of the directors to put in more efforts and dedication
to increase the growth and performance of the companies, but can be a negative strategy if
over-payment of the directors does not improve the performance of the companies.
On the other hand, Sigler& Carolina (2011), in their elaborate and empirically
evidenced research paper, based on the industrial domains of UK, USA, Australia and other
countries, highlight that in most of the cases, the downfall of the companies as well as the
poor performance of the same, for a prolonged time, is related to the extravagant and
cumbersome expenditure structures of the companies, including those of the extreme over-
payment of the remuneration of the CEOs (Fong, 2010).
Keeping this into consideration, it becomes important to analyse the needs of the high
levels of remuneration of the directors and what implications the same bring for the
companies, which can be seen to be less discussed in the existing literary frameworks and
which the concerned research tries to take into consideration for analysis and interpretation.
Chapter 3: Research Methodology
3.1 Data Collection
The process of data collection refers to the measuring and gathering of the
required information in an established systematic manner that would help in answering the

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stated test hypotheses, research questions, and evaluate the results (Smith, 2015). The
primary objective of the data analysis in the given discussion is to examine the remuneration
of the director. In addition to that in order analysis the performance of the business
particularly the share price and the net profit is examined of the chosen ASX listed
organisation (Mackey & Gass, 2015). The scope of this particular research, unlike other
researches, is more specific and the chosen information is recent. The focus of the particular
research is on the Top ASX listed Australian companies.
3.2 Sample Selection and Data Sources
The process of sample selection is the process of choosing the data for the analysis.
Due to time constraint the research is more focused on the accurate process of sampling. The
ASX listed companies are chosen. Since, they comply with the standards, rules and codes of
sound corporate governance (Flick, 2015). The one of the chosen factors in this research is
share price, which is determined. Three ASX listed company chosen for the analysis are
Woolworths limited, Wesfarmers limited and Telstra Corporation. The recent three annual
reports are to be examined for the data.
3.3 Variables
The research variables of different scientific experiment or else research procedures
are necessarily factors that can be manipulated and enumerated. Any specific factor can
assume different values can be considered to be a scientific variable that can exert influence
on experimental research (Mackey & Gass, 2015). Three different variables are considered
for the current study. There are diverse quantifiable facets considered in this study. However,
the study at hand focuses on investigation of director remuneration related to net profit and
share price of firms. Net profit, level of remuneration and share price for three different firms
for the period 2015 to 2017 are identified variables that are examined.

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DIRECTORS’ REMUNERATION'S AND PROFIT AND SHARE PRICE OF FIRMS
3.3.1 Independent Variables
As suggested by Silverman (2016), independent variables indicate the fact that this is
a mathematical variable that is essentially independent of different other variables in a
specific expression or else function. Independent variable’s value can ascertain multiple
values of varied variables. For the purpose of the present study, directors’ remuneration is
considered as the independent variable.
3.3.2 Dependent Variables
Dependent variable refers to a specific variable in an experiment, whose value
essentially relies upon independent variables. Fundamentally, this refers to a specific
phenomenon that is altered by the impact of related factor otherwise known as the
independent variable (Silverman, 2016). For the purpose of the current study, dependent
variables of this study are the net profit as well as price of shares of firms that reflect overall
performance of firms listed in the Australian Stock Exchange. The share price was selected
from the annual financial report and the market index price of each end of the financial year
and the net profit after tax was selected for the second dependent data.
3.4 Structure of the research
The current research is essentially quantitative in nature. Essentially, quantitative
research study refers to systematic empirical assessment of diverse observable phenomena
namely, statistical, mathematical or else computational procedure. Descriptive statistics
undertaken for the study are essentially utilized for the purpose of illustrating basic
features/components of data. Essentially, descriptive statistics such as central tendency,
dispersion and many others are taken into consideration. In essence, descriptive study
presented in this study help in delivering a simple understanding regarding the amassed data.
Also, inferential statistics taken into consideration for the study has used regression analysis.

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Particularly, regression analysis delivers understanding regarding information associated to
both independent as well as dependent variable.
Chapter 4: Findings and Analysis
4.1 Analysis of descriptive
Woolworths Limited
Remuneratio
n Net Profit
Share
Price
Mean 53950154.67
815066.666
7 75339328
Median 58508000 1534000 79081634
Standard
Deviation 42472583.68
1801416.39
1 23213530
Range 84577536 3380800 45972354
Minimum 9382464 -1234800 50481998
Maximum 93960000 2146000 96454352
Sum 161850464 2445200
22601798
4
Wesfarmers Limited
Remuneratio
n Net Profit
Share
Price
Mean 2440790
1906666.66
7 55793243
Median 2487660 2440000 52342257
Standard
Deviation 85495.95424
1316670.92
8 6550499
Range 150492 2466000 11657969
Minimum 2342109 407000 51689751
Maximum 2492601 2873000 63347720
Sum 7322370 5720000
16737972
8
Telstra Corporation limited
Remuneratio
n Net profit
Share
price
Mean 15686087.67 463400000 5333333.3
Median 15350387 423100000 5560000
Standard
Deviation 2075401.5 100691956 940708.95
Range 4109876 188900000 1840000
Minimum 13799000 389100000 4300000

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Maximum 17908876 578000000 6140000
Sum 47058263 1390200000 16000000
Table 1: Presenting the descriptive statistics for variables for the three different firms
Based on the information presented in the above mentioned table, it can be hereby
stated that for the firm Woolworths Limited, maximum remuneration level is recorded to be
93960000. Maximum net profit for the firm is 2146000 and maximum and maximum share
price is 96454352. For the firm Woolworths Limited, average figures for remuneration for
the firm stands at 53950154, mean net profit stands at 815066 while the mean share price
stands at 75339328. The maximum remuneration figure for the firm Wesfarmers Limited
stands at 2492601 that are relatively lower than that of Woolworths Limited and greater than
that of Telstra Corporation Limited. Also, the mean remuneration, net profit and share price
of the firm Wesfarmers are also said to be lower than that of Woolworths Limited.
4.2 ANNOVA
Anova: Single Factor Net Profit
SUMMARY
Groups Count Sum Average Variance
Net Profit (Woolworths
Limited)
3 244520
0
815066.
7
3.2451E+1
2
Net Profit (Wesfarmers
Limited)
3 572000
0
190666
7
1.73362E+
12
Net profit (Telstra Corporation
limited)
3 1.39E+0
9
4.63E+0
8
1.01389E+
16
ANOVA
Source of Variation SS df MS F P-value F crit

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Between Groups 4.27E+
17
2 2.13E+1
7
63.136111
42
9.33357E-
05
5.1432
53
Within Groups 2.03E+
16
6 3.38E+1
5
Total 4.47E+
17
8
Anova: Single Factor Share Price
SUMMARY
Groups Count Sum Average Variance
Share Price (Woolworths
Limited)
3 2.26E+0
8
753393
28
5.38868E+
14
Share Price (Wesfarmers
Limited)
3 1.67E+0
8
557932
43
4.2909E+1
3
Share price (Telstra
Corporation limited)
3 160000
00
533333
3
8.84933E+
11
ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 7.83E+
15
2 3.91E+1
5
20.155146
41
0.0021748
09
5.1432
53
Within Groups 1.17E+
15
6 1.94E+1
4
Total 8.99E+ 8

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15
Anova: Single Factor
SUMMARY
Groups Count Sum Average Variance
Remuneration (Woolworths
Limited)
3 1.62E+0
8
539501
55
1.80392E+
15
Remuneration (Wesfarmers
Limited)
3 732237
0
244079
0
730955819
1
Remuneration (Telstra
Corporation limited)
3 470582
63
156860
88
4.30729E+
12
ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 4.29E+
15
2 2.15E+1
5
3.5610344
87
0.0955975
59
5.1432
53
Within Groups 3.62E+
15
6 6.03E+1
4
Total 7.91E+
15
8
Table 2: ANNOVA analysis
For the purpose of the current study, Analysis of Variance (also known as ANNOVA)
can be considered to be a collection of diverse statistical models and their related estimation

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processes (namely, variation among as well as between different groups). This is carried out
to evaluate variances among specific group means in a specific sample. ANNOVA can be
regarded to be a collection of statistical model designed for analysing difference between
different groups such as net profit for the three different firms, share price for three different
firms and remuneration for three different firms. In ANNOVA, there is a significance level
(reflected as alpha) of essentially 0.05. In case if the p –value is higher than the mentioned
significance level, then there exists no adequate evidence or substantiation to reject the
mentioned null hypothesis.
For the group “net profit” of the firms, the p value is recorded to be 0.00009.
Therefore, p value is said to be lower than that of (p value=0.05), the null hypothesis can be
rejected in favour of different alternative hypothesis. Therefore, null hypothesis that
indicates that there exists no considerable variation between the said populations is rejected.
Thus, it can be concluded that there exists substantial difference between net profits of the
corporation.
For the group “share price” of the firms, the p-value is registered to be 0.002. It can be
hereby observed that p value of the firm is lower than 0.05. Therefore, null hypothesis that
refers to the fact that there subsists no relative difference between the specific populations is
rejected. Therefore, it can be hereby inferred that exists substantial variation between share
prices of the three different firms taken into consideration.
For the group “remuneration” of the firms, p-value is recorded to be 0.095.
Essentially, it can be mentioned that p value of the corporation is greater than 0.05. Thus, we
fail to accept the null hypothesis that mentions that presents no relative variance between the
specific population.

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4.3 Correlation Analysis:
Woolworths Limited
Correlation Remuneration
Remuneration 1
Net Profit -0.260716033
Share Price -0.972945448
Wesfarmers Limited
Correlation Remuneration
Remuneration 1
Net Profit -0.377707314
Share Price -0.999781053
Telstra Corporation limited
Correlation Remuneration
Remuneration 1
Net profit -0.672076552
Share price 0.43849749
Table 3: Correlation Coefficient Analysis
The table shows enumeration of correlation between remuneration, share price and net
profit. Based on calculations presented above, it can be hereby mentioned that there exists
negative correlation between net profit and remuneration and share price and remuneration
for the firm Woolworths Limited. This shows that increase in remuneration leads to decrease
in net profit as well as share price of the corporation Woolworths Limited.
The table above mentions above shows that there exists negative association between
net profit and share price with remuneration of the firm Wesfarmers Limited. Similarly, this
reflects enhancement in remuneration directs towards decrease in both net profit as well as
price of shares. For the firm Telstra Corporation, it can be observed that there exists negative
association between net profit and remuneration. Again, there exists positive association
between remuneration and share price, while, there subsists negative association between net
profit and remuneration.

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Chapter 5: Discussion
The current segment of the research paper presents a comparison to prior studies.
Particularly, the current research has attempted to find an association with net profit as well
as prices of shares of firms with the level of remuneration of important management
personnel of the firms (Frederick, 2011).
5.1 Directors remuneration with the profit
The outcome of the research study reflects that there exists negative correlation
between net profit and remuneration of the firm for the firm Woolworths Limited. Again, for
the firm Wesfarmers Limited as well, negative correlation can be discovered between net
profit and remuneration of the firm. In addition to this, there exists a negative association
between net profit and remuneration of the firm of the firm Telstra Corporation Limited.
The results of the study represents that there subsists a negative association between
share price and remuneration of the firm Woolworths Limited. In addition to this, negative
correlation can be discovered between share price and remuneration of the firm for the firm
Wesfarmers Limited. Further, similarly positive relationship can be found between share
price and remuneration of the firm Telstra Corporation Limited.
5.2 Limitations
One of the most important limitations of the study is overall size of the sample. Prior
studies were conducted on over and above 100 business concerns. However, the sample for
the current research was based on three ASX listed corporations in the top 20 list. The only
three firms are selected for the study. The small size of the samples present
In essence, ASX 20 corporations are regarded to be superior to other listed
corporations. It can be hereby stated that verities of firm population could probably have
presented a diverse image (Foster, 2012). However, another disadvantage was the financial

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period was limited to 3 years. Particularly, a long term of alteration in the specific system can
deliver a perfect view of circumstances of the business corporation.
5.3 Conclusion and Recommendations
Based on analysis of the present study, it can be hereby mentioned that there exists
significant variance between net profits as well as price of shares of selected firms. However,
level of remuneration is said to be somewhat similar and exists no significant difference
between the same among the selected groups. Results of the correlation analysis reflects the
fact that there exists negative association (that is to say, inverse relationship) between net
profit and share prices of firms with level of remuneration for the firms Woolworths limited
and Wesfarmers Limited. However, based on amassed data on Telstra Corporation limited, it
can be hereby stated that there exists a positive association although not very strong between
price of shares and remuneration. Thus, it can be hereby inferred that level of remuneration
exerts adverse influences on overall profitability of firms in general.
The current study has attempted to establish association between remuneration of
director and firm’s net profit and price of shares. Nevertheless, a greater sample size for
financial data evaluation could have made the outcome more strong and at the same time
accurate. In addition to this, there are diverse other facets counting different external
uncontrollable facets need to be considered whilst carrying out the study. Essentially, there
are different uncontrollable factors that are expected to balance unusual alterations in then
sample collection data. Undertaking further research on greater sample and with more
number of financial year backgrounds shall deliver a superior outcome.

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Smith, J. A. (Ed.). (2015). Qualitative psychology: A practical guide to research methods.
Sage.
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corporate governance: A conceptual framework and survey. Journal of economic
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https://cloudfront.escholarship.org/dist/prd/content/qt3287q5sk/qt3287q5sk.pdf
ANDREW. KEAY, L. L. B. (2016). DIRECTORS'DUTIES. JORDAN PUBLISHING
Limited. Retrieved from:
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DIRECTORS’ REMUNERATION'S AND PROFIT AND SHARE PRICE OF FIRMS
Appendix:
1) Raw Data
Woolworths Limited
Year Remuneration Net Profit Share Price
2015 9382464 2146000 96454352
2016 58508000 -1234800 79081634
2017 93960000 1534000 50481998
Wesfarmers Limited
Year Remuneration Net Profit Share Price
2015 2342109 2440000 63347720
2016 2492601 407000 51689751
2017 2487660 2873000 52342257
Telstra Corporation limited
year Remuneration Net profit Share price
2015 17908876 4231,00,000 6140000
2016 13799000 5780,00,000 5560000
2017 153,50,387 3891,00,000 4300000
2) Descriptive
Woolworths Limited
Remuneration Net Profit Share Price
Mean 53950154.67 815066.6667 75339328
Median 58508000 1534000 79081634
Standard Deviation 42472583.68 1801416.391 23213530
Range 84577536 3380800 45972354
Minimum 9382464 -1234800 50481998
Maximum 93960000 2146000 96454352
Sum 161850464 2445200 226017984
Wesfarmers Limited
Remuneration Net Profit Share Price
Mean 2440790 1906666.667 55793243
Median 2487660 2440000 52342257
Standard Deviation 85495.95424 1316670.928 6550499
Range 150492 2466000 11657969
Minimum 2342109 407000 51689751
Maximum 2492601 2873000 63347720

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DIRECTORS’ REMUNERATION'S AND PROFIT AND SHARE PRICE OF FIRMS
Sum 7322370 5720000 167379728
Telstra Corporation limited
Remuneration Net profit Share price
Mean 15686087.67 463400000 5333333.3
Median 15350387 423100000 5560000
Standard Deviation 2075401.5 100691956 940708.95
Range 4109876 188900000 1840000
Minimum 13799000 389100000 4300000
Maximum 17908876 578000000 6140000
Sum 47058263 1390200000 16000000
3) ANNOVA
Anova: Single Factor Net Profit
SUMMARY
Groups Count Sum Averag
e
Variance
Net Profit (Woolworths Limited) 3 244520
0
815066
.7
3.2451E+1
2
Net Profit (Wesfarmers Limited) 3 572000
0
190666
7
1.73362E+
12
Net profit (Telstra Corporation
limited)
3 1.39E+
09
4.63E+
08
1.01389E+
16
ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 4.27E+
17
2 2.13E+
17
63.136111
42
9.33357E-
05
5.1432
53
Within Groups 2.03E+
16
6 3.38E+
15
Total 4.47E+
17
8
Anova: Single Factor Share Price
SUMMARY

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DIRECTORS’ REMUNERATION'S AND PROFIT AND SHARE PRICE OF FIRMS
Groups Count Sum Averag
e
Variance
Share Price (Woolworths
Limited)
3 2.26E+0
8
753393
28
5.38868E+
14
Share Price (Wesfarmers
Limited)
3 1.67E+0
8
557932
43
4.2909E+1
3
Share price (Telstra Corporation
limited)
3 160000
00
533333
3
8.84933E+
11
ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 7.83E+
15
2 3.91E+1
5
20.155146
41
0.0021748
09
5.1432
53
Within Groups 1.17E+
15
6 1.94E+1
4
Total 8.99E+
15
8
Anova: Single Factor
SUMMARY
Groups Count Sum Averag
e
Variance
Remuneration (Woolworths
Limited)
3 1.62E+
08
539501
55
1.80392E
+15
Remuneration (Wesfarmers
Limited)
3 732237
0
244079
0
73095581
91
Remuneration (Telstra
Corporation limited)
3 470582
63
156860
88
4.30729E
+12
ANOVA
Source of Variation SS df MS F P-value F crit
Between Groups 4.29E+
15
2 2.15E+
15
3.561034
487
0.095597
559
5.1432
53
Within Groups 3.62E+
15
6 6.03E+
14
Total 7.91E+
15
8

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DIRECTORS’ REMUNERATION'S AND PROFIT AND SHARE PRICE OF FIRMS
3) Enumeration of Correlation
Woolworths Limited
Correlation Remuneration
Remuneration 1
Net Profit -0.260716033
Share Price -0.972945448
Wesfarmers Limited
Correlation Remuneration
Remuneration 1
Net Profit -0.377707314
Share Price -0.999781053
Telstra Corporation limited
Correlation Remuneration
Remuneration 1
Net profit -0.672076552
Share price 0.43849749