The relation between CEO Pay-performance Sensitivity and Firm Performance - the mediating role of Work/Life Benefits.

Executive compensation and Work Life Balance have been two topics of much debate. Much discussion has been done about the level, structure and role of CEO compensation in the firm performance, while in the same time there are concerns whether companies should provide employees with the balance of work and family. This balance can be achieved by providing Work Life Benefits to employees in order to help them with many facets of their lives such us their well being and their family. The aim of this study is to investigate the mediator effect of Work Life Benefits on the relationship between firm performance and pay performance sensitivity. To test this theory, the delta of the portfolio of the CEO and the company performance of 404 US companies for the time period 2006 to 2010 has been studied. The results of this study suggest a partial mediator effect of Work Life Benefits on the relationship between Pay performance sensitivity and Company Performance.