Firms' Political Connections and Pays Policies to Board of Directors

The purpose of this study is to investigate the impact of corporate political connections on the compensation policies of board of directors. The sample of this research includes 207 companies listed in Tehran Stock Exchange for the years 2008 to 2019. Also, multivariate regression models with Feasible Generalized Least Squares (FGLS) method have been used to test the research hypothesis in a panel data set. The results showed that the political connections of the companies have a significant and negative effect on the level of pay of the board of directors, but have no significant effect on the performancepayment relationship of the board of directors. It was also found that corporate political connections significantly reduce the payment gap between the board of directors and employees.