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| Tekijä: | Li, F. Srinivasan, S. |
| Otsikko: | Corporate governance when founders are directors |
| Lehti: | Journal of Financial Economics
2011 : NOV, VOL. 102:2, p. 454-469 |
| Asiasana: | chief executive officers corporate governance directors stocks rate of return incentives consolidation compensation |
| Kieli: | eng |
| Tiivistelmä: | We study chief executive officer (CEO) compensation, CEO retention policies, and mergers and acquisition (M&A) decisions in firms whose founders work as a director with a nonfounder CEO (founder-director firms). Founder-director firms are found to offer a different incentives mix to their CEOs than other firms. Pay-for-performance sensitivity is higher and pay level is lower for nonfounder CEOs in founder-director firms than those of other CEOs. CEO turnover sensitivity to firm performance is also substantially higher in founder-director firms compared to nonfounder firms. Overall, the evidence indicates that boards with founder-directors offer higher-powered incentives in the form of pay and retention policies than the average US boards. Also stock returns around M&A announcements and board attendance are higher in founder-director firms compared to nonfounder firms. |
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