CEO Tournament Incentives and Corporate Debt Contracting

This study examines the relation between CEO tournament incentives, proxied by the difference between CEO pay and the median pay of the senior executives of a given firm, and corporate debt contracting. We find negative relations between CEO pay gap and the cost of debt and default risk, and a positive relation between CEO pay gap and debt maturity. Further analysis indicates that the results are stronger for firms with near-retirement CEOs, which are more likely to run CEO tournaments. Our evidence suggests that creditors view tournament incentives favorably and are willing to provide better debt terms

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Year of publication:	2022
Authors:	Ghosh, Chinmoy ; Huang, Di ; Nguyen, Nam ; Phan, Hieu V.
Publisher:	[S.l.] : SSRN
Subject:	Führungskräfte \| Managers \| Leistungsanreiz \| Performance incentive \| Verbindlichkeiten \| Corporate debt \| Leistungsentgelt \| Performance pay \| Managervergütung \| Executive compensation \| Vertragstheorie \| Contract theory \| Kapitalstruktur \| Capital structure \| Fremdkapital \| Debt financing

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Extent:	1 Online-Ressource (53 p)
Type of publication:	Book / Working Paper
Language:	English
Notes:	In: Journal of Corporate Finance Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments 2022 erstellt
Classification:	G30 - Corporate Finance and Governance. General ; G32 - Financing Policy; Capital and Ownership Structure ; G34 - Mergers; Acquisitions; Restructuring; Corporate Governance
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10014235416