企业职工薪酬管理中英文文献对照 第5页
firms near or above the million-dollar threshold. (3) For a subset of firms that reduce salaries to a level at or below one million dollars, we find that firms reduce salaries in response to 162(m). At the same time, these salary reductions do not typically lead to lower total compensation for the CEOs of these firms. (4) For all firms and especially those firms affected by 162(m), we find an increase in the sensitivity of bonus payments and total compensation to contemporaneous and lagged stock performance after 1993. This increased sensitivity of compensation to stock returns is not due to the mechanical increase in stock option values when the stock market is rising. (5) The performance sensitive components of compensation, especially stock option grants, have become much larger components of total compensation following 1993. Overall, these results suggest that compensation committees have taken 162(m) into account by modifying the structure of compensation contracts. Additional analysis of the changes in firm-specific CEO wealth and compensation suggests that these changes have also had a significant economic impact beyond annual compensation flows determined by the board of directors.
In the first part of our paper, we emphasize annual pay, defined as the annual flows of cash compensation and option and restricted stock grants. In the context of the regulations, it is important to analyze this annual flow because: (1) the compensation committee of the board of directors has a direct influence over this annual flow to the CEO; (2) shareholder activists, the press, regulators, and many previous academic studies have focused on the annual pay of CEOs and not on changes in the value of CEO equity holdings; and (3) the regulations were directly targeting this annual flow, especially 原文请找腾讯752018766;优/文-论~文'网
http://www.youerw.com -related CEO wealth changes and find that the sensitivity of CEO wealth to shareholder wealth is higher than the one reported by Jensen and Murphy for the 1970s and 1980s. For instance, using the Jensen-Murphy statistic or sharing rate, defined as the dollar change in CEO wealth for a $1,000 change in firm value, we document median CEO sharing rates in 1996 from $7 to about $25 per $1,000 shareholder gain or loss, depending on the subgroup. This is in line with the Hall and Liebman finding that pay to performance sensitivity in the 1990s is substantially higher than the sensitivity documented by Jensen and Murphy for earlier periods. More importantly, in a regression framework we find that there is an increase in the wealth to performance sensitivity from 1993 to 1996 for firms approaching the million-dollar benchmark, i.e. firms affected by 162(m).
The paper is organized as follows. In Section 2, we discuss the background for the changes in the SEC Compensation Disclosure Rules and 162(m). In Section 3, we discuss our data collection procedure. Section 4 presents our empirical results on the effects of the regulation on compensation structure, salary levels and growth rates, and compensation to performance sensitivity. Section 5 evaluates the effects of the regulations on the sharing rate and other measures of the sensitivity of CEO wealth on changes in shareholder wealth. We examine the robustness of our results in Section 6 and offer concluding comments in Section .
2. The SEC's new Compensation Disclosure Rules and I.R.C. Section 162(m)
As a result of public perception regarding excessive executive pay in the early 1990s, executive compensation became a hot political issue. As a result, the Securities and Exchange Commission adopted new rules regarding disclosure of executive compensation in 1992.3 These rules required that corporations enhance the disclosure of executive compensation in proxy statements beginning with the 1993 proxy season. Under the new rules, firms are required to: (1) compare their financial performance to an industry benchmark with a table and performance graphs; (2) disclose in a tabular form the annual and long-term compensation for the CEO and the four most highly paid executives; (3) provide estimates of the present value of managerial stock options granted; and (4) provide a report by the compensation committee explicitly identifying quantitative or qualitative performance measures used to evaluate managers.
Researchers have examined managerial reporting discretion relating to portions of these rules and their results suggest that managers and/or directors place great importance on 上一页 [1] [2] [3] [4] [5] [6] 下一页
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