We examine how accounting-based compensation plans influence a firm's contracts with its creditors. After granting long-term accounting-based compensation plans (LTAPs) to CEOs, firms pay lower spreads and have fewer restrictive covenants in new bank loans. Mechanisms leading to lower borrowing...

Motivated by the dual agency environment in founding family firms, we examine how family firms provide compensation incentives to nonfamily executives. Nonfamily executives receive weaker risk-taking incentives and pay-for-performance incentives when family ownership is high and when family...

We examine how incentive compensation for nonfamily executives in family firms differs from incentive compensation for executives in nonfamily firms. Nonfamily executives in family firms receive significantly less performance-based pay and equity-based pay. Family monitoring, risk aversion, and...

We use a hand-collected sample of 1,628 S&P 1500 firms and more than 12,000 executives to examine how family firms compensate nonfamily executives. Family firms comprise a large percentage of firms around the world, and most of their executives are not members of the founding family. Moreover,...

Family firms comprise more than one third of U.S. public firms. They differ significantly from widely-held firms in their promotion-based tournament environment and agency conflicts. These differences are likely to affect the design and efficacy of compensation incentives. However, most existing...