The compensation committee and the remuneration of the directors

Purpose - The purpose of this paper is to analyze if the composition and activity of the appointment and remuneration committee have a significant effect in the remunerations of the members of the board of directors. Design/methodology/approach - To achieve the paper's objective the authors proposed four hypotheses in order to analyze the repercussions of independent, institutional and executive directors in the Appointment and Retribution Committee (ARC) and its activity in the directors' remunerations. Findings - The results put into evidence that the composition (independent, institutional and executive members) of the ARC is not associated with the variation of the directors remuneration mean, while the activity of the ARC influences positively this remuneration mean, contrary to what was expected. Originality/value - The ARC in Spain is not effective in fixating the directors' remunerations.