We examine the relation between corporate governance and managerial risk-taking behavior. In light of the global financial crisis, the importance of effective governance structures in protecting claimholder interests cannot be emphasized enough. For corporate governance, we propose to include...

This paper examines whether the risk-taking incentives induced by performance-based vesting (p-v) compensation influence bank loan contracting and credit ratings. Consistent with our risk-shifting hypothesis, we find that the p-v based compensation, as measured by the proportion of grant date...