上市公司高管股权激励计划外文翻译文献.docx

上市公司高管股权激励计划外文翻译文献.docx

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上市公司高管股权激励计划外文翻译文献

上市公司高管股权激励计划外文翻译文献

（文档含中英文对照即英文原文和中文翻译）

原文：



InvestorpricingofCEOequityincentives

JeffP.Boone InderK.Khurana K.K.Raman

Abstract

ThemainpurposeofthispaperistoexploreCEOcompensationintheformofstockandoptions.TheobjectiveofCEOcompensationistobetteralignCEO-shareholderinterests by inducing CEOs to make more optimal （albeit risky）investmentdecisions.However,recentresearchsuggeststhattheseincentiveshaveasignificantdown-side（i.e.,theymotivateexecutivestomanipulatereportedearningsand lower information quality）. Given the conflict between the positiveCEO-shareholderincentivealignmenteffectandthedysfunctionalinformationqualityeffect,itisanopenempiricalquestionwhetherCEOequityincentivesincreasefirmvalue.WeexaminewhetherCEOequityincentivesarepricedinthefirm-specificexanteequityriskpremiumoverthe1992–2007timeperiod.Ouranalysiscontrolsfortwopotentialstructuralchangesoverthistimeperiod.Thefirstisthe1995DelawareSupremeCourtrulingwhichincreasedprotectionfromtakeovers（anddecreasedrisk）

forDelawareincorporatedfirms.Thesecondisthe2002Sarbanes–OxleyActwhichimpactedcorporaterisktaking,equityincentives,andearningsmanagement.Collectively,ourfindingssuggestthatCEOequityincentives,despitebeingassociatedwithlowerinformationquality,increasefirmvaluethroughacostofequitycapitalchannel.

Keywords：

CEOequityincentives，Informationquality，Costofequitycapital

Introduction

Inthisstudy,weinvestigateinvestorpricingofCEOequityincentivesforalargesampleofUSfirmsovertheperiod1992–2007.BecauseincentivesembeddedinCEOcompensationcontractsmaybeexpectedtoinfluencepolicychoicesatthefirmlevel,ourobjectiveistoexaminewhetherCEOequityincentivesinfluencefirmvaluethroughacostofequitycapitalchannel.

Priorresearch（e.g.,Jensenetal.2004;JensenandMurphy1990）suggeststhatequity-basedcompensation,i.e.,CEOcompensationintheformofstockandoptions,providestheCEOapowerfulinducementtotakeactionstoincreaseshareholdervalue（byinvestinginmoreriskybutpositivenetpresentvalueprojects）.Putdifferently,equityincentivesareexpectedtohelpmitigateagencycostsbyaligningtheinterestsoftheCEOwiththoseoftheshareholders,andotherwisehelpcommunicatetoinvestorstheimportantideathatthefirm’sobjectiveistomaximizeshareholderwealth（HallandMurphy2003）.

However,recentresearchcontendsthatequityincentivesalsohaveaperverseordysfunctionaldownside.Inparticular,equity-basedcompensationmakesmanagersmoresensitivetothefirm’sstockprice,andincreasestheirincentiveto manipulatereportedearnings—i.e.,tocreatetheappearanceofmeetingorbeatingearningsbenchmarks（suchasanalysts’forecasts）—inanattempttobolsterthestockpriceandtheirpersonalwealthinvestedinthefirm’sstockandoptions（BergstresserandPhilippon2006;BurnsandKedia2006;ChengandWarfield2005）.Statedinanotherway,CEOequityincentivescanhaveanadverseeffectonthequalityofreportedaccountinginformation.AsnotedbyBebchukandFried（2003）andJensenetal.（2004）,by promotingperversefinancialreportingincentivesandloweringthequalityofaccountinginformation,equity-basedcompensationcanbeasourceof,ratherthanasolutionfor,theagencyproblem.

Despitetheseargumentsabouttheputativeilleffectsofequityincentives,equity-basedcompensationcontinuestobeasalientcomponentofthetotalpaypackagesforCEOs.Still,giventheconflictbetweenthepositiveincentivealignmenteffectandthedysfunctionaleffectoflowerinformationquality,itisanopenempiricalquestionwhetherCEOequityincentivesincreasefirmvalue.Toourknowledge,priorresearchprovidesmixedevidenceonthisissue.Forexample,Mehran（1995）examines1979–1980compensationdataandfindsthatequity-basedcompensationispositivelyrelatedtothefirm’sTobin’sQ.Bycontrast,Aboody（1996）examinescompensationdataforasampleoffirmsforyears1980through1990,andfindsanegativecorrelationbetweenthevalueofoutstandingoptionsandthefirm’sshareprice,suggestingthatthedilutioneffectdominatestheoptions’incentivealignmenteffect.Moreover,boththesestudiesarebasedondated（i.e.,pre-1991）data.

Inourstudy,weexaminewhetherCEOequityincentivesarerelatedtothefirm-specific exanteequityriskpremium,i.e.,theexcessofthefirm’sexantecostofequitycapitalovertherisk-freeinterestrate（ametricdiscussedbyDhaliwaletal.2006）.ConsistentwithCoreandGuay（2002）,wemeasureCEOequityincentivesasthesensitivityoftheCEO’sstockandoptionportfoliotoa1percentchangeinthestockprice.Basedonasample