Do Governance Practices Strengthen the Pay–Performance Relationship of <scp>CIO</scp> ?

ABSTRACT This study investigates the pay–performance relationship of Chief Investment Officers (CIOs) in Australian industry superannuation funds and the impact of governance practices on this relationship. The study finds that CIO pay is positively associated with fund performance and this relationship is stronger for large funds. Despite regulatory recommendations for enhanced governance practices, such as increased board independence and diversity, these practices do not significantly strengthen the pay‐performance link. The findings suggest that one‐size‐fits‐all governance reforms for different types of superannuation funds, may be ineffective, highlighting the need for tailored approaches to improve executive remuneration practices in superannuation funds.