There are different research approaches or strategies that can be employed, such as symbolic interactionism, hermeneutics, ethnomethodology, or phenomenology. For the purpose of the present study and in an attempt to answer the posed research question, the phenomenological approach or strategy was chosen. Henning (2005, p.16) believes that these
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varying approaches or strategies all have their own disciplinary roots, and that philosophy is the disciplinary root for phenomenology, as it is concerned with questions such as, "What is the structure and essence of experience of this phenomenon for these people?" Kelly (TerreBlanche et al., 2002, p. 414) has a similar belief, namely that phenomenology is concerned with the “shared ‘local’ understanding of a phenomenon.” Once again, this aligned with the aim of the present research question, as the research question focuses on understanding the phenomenon of corporate governance with regard to executive remuneration.
3.2.4.1 Research techniques.
The research question demanded a search for understanding of an experience or phenomenon, namely adherence to the spirit of corporate governance in terms of executive remuneration. The current divergent understandings of the phenomena have neither been documented, nor are there any case studies available, which is why the present researcher chose semi-structured interviews to gather data. This choice is related to the opinion of Terre Blanche and Kelly (TerreBlanche et al., 2002, p. 128), who believe that “conducting an interview is a more natural form of interacting with people than making them fill out a questionnaire, do a test or perform some experimental tasks, and therefore fits well with the interpretive approach to research.”
Semi-structured interviews
May (2001, p.120) believes that interviews could be the appropriate choice when wishing to gain an understanding of participants’ experiences, as they yield “rich insights into people’s experiences, opinions, aspirations, attitudes and feelings.” The reasons or justification for choosing interviews as the research method might be best summarised by the Miller and Glassner as quoted by May (2001, p.127): “those of us who aim to understand and document others’ understandings choose qualitative interviewing because it provides us
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with a means for exploring the points of view of our research subjects, while granting these points of view the culturally honoured status of reality” (Miller & Glassner, 1997:100). Governance is dynamic, and the present research question was aimed at gaining an understanding of how people in the world of work interpret adherence to the spirit of corporate governance with regard to executive remuneration, and how this understanding manifests in behavioural terms. Semi-structured interviews allowed the present researcher the freedom to explore the shared understanding of the phenomenon.
The researcher informed the participants that the interviews would be electronically recorded and transcribed. Represented in Table 6 is the interview schedule with introduction and questions.
Table 6
Interview schedule
Introduction to the interview:
These interviews are for the purpose of completing my Master’s degree at the University of Johannesburg. My research question is, "Adherence to the spirit of corporate governance: Executive remuneration." I do want to make it clear that I am not attempting to make a judgement as to whether persons are adhering or not adhering to the principles and recommendations of the King III Report in relation to executive remuneration; but rather to gain an understanding of how these principles and recommendations are applied within an organisation and to explore possible opportunities for improvement. Further, I wish to emphasise that participation is voluntary and that the confidentiality of the information will be maintained. Your identity will not be revealed. I wish to, once again, inform you that the interviews will be recorded electronically and subsequently professionally transcribed. Are there any questions before we begin? Please remember that this is a conversation and you are free to air your opinions or beliefs without any judgement; I may, however, ask you for clarification.
Question
Number Question Sub-Questions
1 What is your perception of the current state of executive remuneration in South
Africa? Additional questions that
serve to clarify, probe, and facilitate understanding. 2 'Too little' or 'too much' is a meaningless value statement if there is no clear
standard. What is the value and standard, and who determines it?
3 How should fair and responsible remuneration for executives be determined? 4 What structures could be used to inform organisations in determining
executive remuneration?
4.1 What structures internal to the organisation? 4.2 What structures external to the organisation?
5 What, to whom, and how should decisions and other information (e.g., magnitude) be communicated?
6 Where should accountability for executive remuneration be located? 7 What excites you about executive remuneration and/or what concerns you
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The questions were aimed at eliciting information with which to understand behaviours related to adherence to the spirit of corporate governance. The first question focused on determining whether there is a perceived problem or not, in other words, problem recognition. Question two dealt with responsibility ‒ where decisions regarding executive remuneration should be located and who should take responsibility for those decisions. Fairness, another of the four ethical values of good corporate governance, was the focus of Question 3. Question 4 aimed to determine to what extent the participants were aware of King III and utilised it in their decisions. Transparency was the focus of Question 5, while accountability, the last of the four ethical values, was the focus of Question 6. Question 7 was aimed at exploring any other issues that the participant might have wanted to discuss.
3.2.4.2 Sample.
One of the most important considerations when conducting research is the decision of who might be best suited to assist the researcher in obtaining information that will answer the posed research question. The present research question is fairly specific, and for this reason, both purposive sampling and snowball sampling were employed. Esterberg (2001, p.93) states that, when conducting qualitative research, the researcher makes a conscious decision to sacrifice breadth for depth, an opinion supported by Durrheim (TerreBlanche, et al. 2002, p.45), in that qualitative research typically does not require large or random samples, as the objective is in-depth rather than statistical analysis. Further considerations in the selection of a sample for the present study were the number of participants the researcher might have access to and the resources available to the researcher.
Another key consideration in selecting the participants was that executive remuneration needed to be explored from various angles, therefore it was decided that the participants needed to belong to one of the following four interest groups: external interest groups, remuneration consultants, chief executive officers, and board members. The external
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interest group was represented by members of trade unions and members of the media. Remuneration consultants were represented by both consultants employed by organisations as well as those working independently. Chief executive officers were those tasked with leading an organisation, while board members were all currently-serving board members of various organisations. For the sake of representivity, it was decided to interview 16 participants; particularly, four participants per interest group. This facilitated a thorough and diverse understanding of the phenomenon of adherence to the spirit of corporate governance with regard to executive remuneration from the viewpoint of four relevant interest groups. Access to these interest groups was facilitated by one of the present study's leaders, who is both a remuneration consultant and a board member.
Another key consideration in sampling is theoretical saturation. Kelly (2002, p.380) describes theoretical saturation as;
The point when one stops collecting new material. Saturation occurs when new information no longer challenges or adds to the emerging interpretative account; when no relevant new information emerges; when category development is dense and rich; when relations among categories are well established and validated; and when there is a sense that the theoretical account is nearing a complete and adequate form. This is sometimes termed ‘sampling to redundancy,’ since further information becomes increasingly redundant, to the extent that it becomes repetitive.
In order to establish the credibility of the participants in the present study, their credentials are provided in table format. Table 7 reflects the profiles of the participants by illustrating the gender distribution, the current title held within the organisation, qualifications, work experience of the participants, and the size of the organisation.
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Table 7 Profiles of participants
Part-
icipant Gender Title Qualifications Experience Organisational size
P1 M Assistant General
Secretary BCom (Human Resources) Diploma: Labour Law 15 years in industrial/employee relations < 500
P2 F Head: Reward MCom
Human Resources Management 20 years in human resource management > 5 000
P3 F Consultant BA
Higher Personnel Management +/- 30 years in general human resource management and organisational consulting < 500 P4 M Chief Executive Officer
(CEO) BSc Chemical Engineering 20 years in executive management 10 years senior management < 500 P5 M Chief Executive Officer
(CEO) Matric 5 years in management 15 years as a director 7 years as Chief Executive Officer (CEO)
< 500
P6 F Director: Compensation
and Benefits B.Soc.Sc PDM M.HR 10 years as human resource management generalist 10 years in Remuneration 1 001 – 5 000 P7 F Head: Global Rewards DComm (Leadership in Performance
and Change)
Registered with the HPCSA as an industrial psychologist
20 years in human resource management, of which 15 years
were in reward management > 5 000
P8 M Head Remuneration and
Benefits Higher Diploma: Personnel Management (Institute of People Management)
Generalist: human resource management in the banking industry
Management information systems – HR
Consulting: remuneration, performance management, incentive scheme design
Senior management experience
51 Part-
icipant Gender Title Qualifications Experience Organisational size
P9 F Financial Services
Reporter BA (Hons) H Diploma: Company Law Financial journalist and co-author of a book on executive pay > 5 000 P10 M Social Development
Policy Coordinator Honours degree 6 years > 5 000
P11 M Remuneration
Consultant BCom +/- 20 years in finance and human resource management of which +/- 10 years were at senior level < 500
P12 M Chairperson DCom 20 years as an executive
Member of several boards Commissioner in the presidency
< 500
P13 M Associate Director:
Reward Management MCom 15 years in reward management consulting 4-5 years at senior executive level > 5 000 P14 M Head: Production Pillar Advanced Project Management
Certificate: Labour Studies 4 years as a job grading officer 4 years as a national educator 5 years as senior manager
> 5 000
P15 M Chief Executive Officer
(CEO) MBA D.Phil 14 years in financial services 16 years in sales 14 years in management
8 years in executive management
> 5 000
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3.2.4.3 Data analysis.
According to Terre Blanche and Kelly, the purpose of data analysis is to place real- life events into some form of perspective, enabling others to see the phenomenon in a new perspective (TerreBlanche, et al. 2002, p.140). To facilitate this understanding of a phenomenon from a new perspective, various forms of data analysis were available to the researcher, such as ethnographic, narrative, experiential, discourse, or content analysis, to name but a few. The present researcher chose content analysis for this research project. Henning (2005) suggests that this method of data analysis works on only one level of meaning, namely the content of the data texts. The present researcher, however, believed that this form of data analysis could facilitate an understanding and re-conceptualisation of the concept of adherence to the spirit of corporate governance regarding executive remuneration as expressed by the four interest groups.
The process of content analysis as applied in this study is represented in Figure 2.
“Transcribed text of single interview. Read set of data to form impression of context of single utterances.”
“Segment units of meaning – in one or more sentences or phrases. Use a marker to show the end of a unit.”
“Label a unit of meaning in more than a single word. Write this label in the margin with an arrow pointing to the text.”
“Look for possible groupings of the codes.”
“Make a list of all the codes and then READ the whole text again to see whether the codes make sense and whether there is some coherence. Also make sure that codes can be related to the research question.”
Figure 2. Coding from texts (Henning, 2005, p.104)
The content analysis that was applied in this research process can be described as follows: After the 16 interviews had been professionally transcribed, they were read by the researcher a number of times in order to glean an overall impression before commencing with
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a coding process. Once an overall impression had been obtained, line-by-line coding was applied to the transcribed interviews. Relevant sections were underlined with pencil and then connected with a line to the margin where a phrase that best summarised the section was recorded. This process was repeated with all 16 interviews. The researcher then combined the noted codes in the margins into similar clusters or groups, and an overall theme or phrase was assigned to the group that best described the grouping of the codes. Subsequently, all 16 interviews were read again to ensure that there was coherence, that the researcher had not lost focus on what the research questions were, and that assigned themes were directly related to the research question. Subsequently, each theme’s frequency of occurrence was manually calculated. Definitions of and interrelationships between themes were clarified and subjected to independent review by a subject matter expert.
The coding of the data was supplemented by field notes. Detailed field notes were taken after each interview, thereby not only capturing the interview process itself, but also noting any difficulties the researcher herself might have experienced in the process. The field notes further assisted in clarifying the researcher's thoughts, which aided the coding process.