Your group is part of an asset management team and is tasked with investigating whether
executive directors of listed companies are being paid in line with the value they create for
shareholders.
You are provided with the following information:
• 10-year history of % change in CEO salaries for a sample of the top 100 companies
listed on the JSE.
• 10-year history of % change of total shareholder return (TSR) for the period.
• ALSI returns for the sample period.
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Using the above information, compute and submit the following information to be contained in
the research report:
• Graphically illustrate the relationship between the TSR and the CEO salaries, interpret and
comment.
• Using regression analysis, investigate the relationship between these two variables.
• Show all calculations, interpret the results and comment
• As a robustness check, also illustrate the relationship between the TSR and the ALSI
returns. Using regression analysis, investigate the relationship between the two varibles.
• Compile a report of your findings to be included in the research report