Purpose – This paper seeks to analyze how compensation framing influences the risk‐taking behavior of the firm's chief executive officer (CEO), and the mediating role played by risk bearing. Design/methodology/approach – The study employs a sample of 108 US firms that issued an initial...

Purpose: The purpose of this paper is to enrich the finding by Aguinis et al. (2018) that there is little overlap between the extremes of firm performance and the extremes of CEO pay using a novel approach to characterize the distribution of pay and performance. The authors aim to shift the...

Agency theoretic models have been used in the past to justify the use of stock options as an effective incentive alignment mechanism to create a common fate between principals and agents. In this paper, we use behavioral theory to reach the opposite conclusion – namely, that the design...