The paper examines the motivation and consequences of Golden Parachute (GP) contracts in the context of TBEA, a Chinese company whose GP payment was 1,000 times executive annual salary and which rescinded its GP provision in 2019. We find that for TBEA, whose ownership is dispersed,...

The role of the board of directors in firm strategy has long been the subject of debate. However, research efforts have suffered from several deficiencies: the lack of an overarching theoretical perspective, reliance on proxies for the strategy role rather than a direct measure of it and the...

When today’s actions can affect tomorrow’s value of an asset and when theprincipal does not have access to hard information, either about productiveactivity or monitoring activity, two incentive problems must be simultaneouslysolved: first, the ex ante moral hazard problem of inducing higher...

We examine the relation between the presence of golden parachutes and the cost of debt financing. We hypothesize that since golden parachutes compensate CEOs in the event of termination, CEOs with golden parachutes will have an incentive to increase firm risk and decrease effort, and this will...

This paper studies optimal managerial contracts in two contracting environments. When contracts can be based on earnings, an optimal contract is interpreted as a combination of base salary, golden parachute and bonus. When earnings are not verifiable, two types of optimal contracts are derived:...

<marquage typemarq="italique"/> The question Directors? remuneration in listed companies is a burning issue that the legislator has been trying to address through different reforms introduced in the past years. Although these legal reforms pursue the praiseworthy goal of raising the ?moral standards? with regard to Directors?...