In 1980, Nolan Ryan, a Houston Astros pitcher, became the first million dollar player in the professional baseball league. Since then, players’ compensation in professional sports has substantially increased. In 2018, Lionel Messi, an Argentinian soccer player of FC Barcelona, earned $127 million, where $92 million came from his salary (Forbes 2019). Although there is debate of whether the high level of compensation for professional sports players is justifiable, it is clear that their salaries are  determined based on their previous play record.

Coach compensation is also a popular topic in sports compensation research. A number of studies show that managerial skills affect team performance and revenue ( Porter and Scully, 1982; Scully, 1989). Other studies also show that coaches are overpaid and their compensations are not fully aligned with team performance (Thomas and Van Horn, 2015).

When it comes to ownership, professional sports teams are usually privately owned by corporations or wealthy individuals. A small number of teams, however,  are publicly owned. As traditional executive compensation literature suggests, compensation packages for executives of publicly traded firms are set so that managerial incentives are aligned with firm value, which may be represented by stock price. Our research question is to show how executive compensation is determined for publicly traded sports teams.  We answer the question in this case study by utilizing the data of a group of European Soccer teams (Juventus, AS Roma, Tottenham, etc.) that have equity shares traded in public stock markets.