Relationship between executive compensation and research and development expenditure: an analysis of medium and high technology companies listed on the brazilian stock exchange

Authors

DOI:

https://doi.org/10.21680/2176-9036.2026v18n2ID38952

Keywords:

Executive Compensation, Research and Development, B3 and Innovation

Abstract

Purpose: This study analyzes the relationship between executive compensation (fixed and variable) and research and development (R&D) spending—used as a proxy for innovation effort—in companies listed on the Brazilian stock exchange. The study examines how the incentive structure mitigates managerial risk aversion in sectors where innovation is strategic. The research guides the analysis of the relationship between executive compensation and the intensity of R&D investments in Brazilian medium-high and high-technology companies.

Methodology: This research uses a quantitative, descriptive, and documentary approach, analyzing data from 53 publicly traded Brazilian companies between 2010 and 2022. The focus is on companies with medium-high and high levels of technological development, according to the classification of the Organisation for Economic Co-operation and Development (OECD), adapted by the Industrial Innovation Survey (PINTEC/IBGE). The data were analyzed using linear regression with panel data, controlling for variables such as size, indebtedness, profitability, and Covid-19.

Results: The results demonstrate that the compensation structure influences managers' willingness to allocate resources to innovation. The findings indicate that, although there is a positive correlation between variable executive compensation incentives and R&D, this relationship is moderated by risk aversion and sectoral characteristics. This suggests that variable compensation acts as a partial mechanism to mitigate agency conflict, but its effectiveness depends on balancing it with short-term goals.

Contributions of the Study: This research contributes to the literature by demonstrating how Agency Theory operates in an emerging market, where factors such as institutional instability influence managers' accounting choices. The study shows that, for high-tech companies in Brazil, aligning interests through executive compensation is crucial for sustaining long-term projects over immediate results.

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Author Biographies

Ana Francyele Parente Borges, Universidade Federal do Rio Grande do Sul - UFRGS

Graduated in Accounting Sciences from the Federal University of Tocantins (2019). Master's degree in Accounting and Controllership at the Federal University of Rio Grande do Sul (UFRGS). Postgraduate in Accounting Expertise and Auditing and in Teaching in Higher Education from the Celso Lisboa University Center (2022), member of the Corporate Accounting Study Group (CONTEX) and the Corporate Governance, Compliance and Auditing research group (UFRGS).

Andressa Germann Avila, Universidade Federal do Rio Grande do Sul - UFRGS

Technical training in administration, degrees in law and accounting, specializations in the areas of public safety management, accounting, accounting, expertise and auditing, public accounting, rural accounting and agribusiness, tax law and process, labor law, labor process and social security. MBA in Public Management and Finance. Focus on strategic administration and public finance and decision-making in fiscal and tax contexts. Master's degree in Production Engineering with emphasis on process management, systems modeling and efficiency analysis.

Maria Ivanice Vendruscolo, Universidade Federal do Rio Grande do Sul - UFRGS

Academic of the Academy of Accounting Sciences of Rio Grande do Sul (ACCRGS, 2019). PhD in Informatics in Education from the Federal University of Rio Grande do Sul (2015). Master in Accounting Sciences from the University of Vale do Rio dos Sinos (2007). MBA in Business Management from IBMEC (2003). Extension in Finance from UFRGS (1999) and in Distance Education from PUCRS (2008). Bachelor in Accounting Sciences from the Pontifical Catholic University of RS (1985). Adjunct Professor of the Department of Accounting and Actuarial Sciences at the Federal University of Rio Grande do Sul (2010-Current) and Permanent Professor of the Postgraduate Program in Controllership and Accounting PPGCONT/UFRGS (2016-Current). Coordinator of the Undergraduate Committee in Accounting Sciences (2021-Current). Coordinator of the Undergraduate Committee in Actuarial Science (2017-2021). Coordinator of the Lato Sensu Course in Actuarial Management in Pensions (2020-2022). Coordinator, CNPQ Leader and researcher of the Corporate Accounting Study Group / UFRGS (2011-Present), working mainly on the following topics: Disclosure of Accounting Information, Brazilian and International Accounting Standards (NBC / IFRS) and Accounting Education with a focus on teaching skills. Researcher of the Industrial Policy and Internationalization and Public Management, Municipality and Federation Working Groups of the CEGOV / UFRGS Government Center. Member of the Higher Education Monitoring Committee of the Regional Accounting Council of RS (2020-2021). Member and Coordinator of the Higher Education Monitoring Committee of the Regional Accounting Council of RS (2018-2019). Former Professor at the Pontifical Catholic University of RS (2007/2010) and Former Professor at the Decision Business School (2008/2009). Accountant in a large company in the telecommunications area (2007/1998) and in medium-sized companies (2007/1978), with emphasis on: Corporate accounting, national and international.

Fernanda Kreuzberg, Universidade Federal do Rio Grande do Sul - UFRGS

Bachelor's degree in Accounting from Faculdades de Itapiranga - FAI (2010). Master's degree in Accounting from Universidade Regional de Blumenau - FURB (2013). PhD in Accounting from Universidade Federal de Santa Catarina (2020). She is currently an Adjunct Professor at the Faculty of Economic Sciences (FCE) of the Federal University of Rio Grande do Sul (UFRGS) and a member of the Corporate Accounting Study Group (CONTEX). She works mainly in the area of ​​Financial Accounting, Corporate Governance and Finance. Contact at fernanda.kreuzberg@ufrgs.br      

Fernanda Gomes Victor, Universidade Federal do Rio Grande do Sul - UFRGS

Professor at the Institute of Economic, Administrative and Accounting Sciences (ICEAC) of the Federal University of Rio Grande (FURG). Professor of Corporate Finance and Capital Markets in the Postgraduate Program in Accounting and Controllership at the Federal University of Rio Grande do Sul (UFRGS). Professor of Quantitative Methods and Contemporary Topics in Financial Management in the Postgraduate Program in Accounting at FURG. PhD in Administration, with a concentration in Accounting and Finance from the School of Administration at UFRGS. Master in Accounting from the University of Vale do Rio dos Sinos (UNISINOS). Graduated in Accounting from the Federal University of Rio Grande (FURG). She has teaching experience in the following subjects: General and Introductory Accounting, Accounting Theory, Cost Accounting, Corporate Accounting, Analysis of Financial Statements and Research Methodology. As an undergraduate, he has taught courses in Civil Engineering and Business Mechanics, Food Engineering, Economics, Business Administration, Accounting and Actuarial Sciences. He also has experience in postgraduate courses in management, accounting, finance and actuarial sciences.

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06-07-2026

How to Cite

Borges, A. F. P., Avila, A. G., Vendruscolo, M. I., Kreuzberg, F., & Victor, F. G. (2026). Relationship between executive compensation and research and development expenditure: an analysis of medium and high technology companies listed on the brazilian stock exchange. REVISTA AMBIENTE CONTÁBIL - Universidade Federal Do Rio Grande Do Norte, 18(2), 65–93. https://doi.org/10.21680/2176-9036.2026v18n2ID38952

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Vol. 18 No. 2 (2026): Jul./Dez.

Section

Section 1: Accounting Applied to the Business Sector (S1)

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