منابع مشابه
The Effectiveness of Stock Option Plans
Despite Stock Option Plans’ (SOPs) widespread use, evidence regarding their use and their effectiveness is relatively sparse and typically relies on an agency theory perspective that emphasizes the principal’s interests in a market context. This study focuses on the agent as an individual who is involved in SOP management. Eighteen interviews with senior executives were conducted. Their respons...
متن کاملCosts of Broad-Based Stock Option Plans∗
We generate estimates of the costs of broad-based stock option programs under varying assumptions about why firms use these pay schemes. We show that, if accounting considerations alone drive option grants, a typical firm in our sample incurs between 50 cents and one dollar of real costs in order to increase reported pre-tax net income by $1. This cost is reduced, but is still quite substantial...
متن کاملIncentives of stock option based compensation
We introduce explicitly the effort as a choice variable in a continuous time utility maximisation framework of an executive who is partly compensated with stock options. We solve the model in the case where the executive is not allowed to trade in the company’s stock but is able to achieve a partial insurance through trading in a correlated market portfolio. We define the executive’s value of t...
متن کاملStock Option Vesting Conditions, CEO Turnover, and Myopic Investment
This paper analyzes the optimal design of stock option vesting conditions when the CEO faces a risk of being replaced at an interim date. First, I show that long vesting terms do not necessarily discourage but in fact can encourage short-termism. Second, the model demonstrates that the optimal vesting schedule involves balancing incentives for managerial effort with incentives for long-term inv...
متن کاملOn the Timing of CEO Stock Option Awards
T study documents that the abnormal stock returns are negative before unscheduled executive option awards and positive afterward. The return pattern has intensified over time, suggesting that executives have gradually become more effective at timing awards to their advantage, and possibly explaining why the results in this study differ from those in past studies. Moreover, I document that the p...
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ژورنال
عنوان ژورنال: Corporate Ownership and Control
سال: 2005
ISSN: 1810-3057,1727-9232
DOI: 10.22495/cocv3i1p8