Ethical approach towards shareholders' interests, in terms of value maximization within predefined risk appetite limits, is the fiduciary responsibility of the corporate governance bodies. However, numerous cases of excessive risk taking as well as inadequate management procedures demonstrate...

In the aftermath of the 2007-2008 financial crisis, flawed variable pay structures of executives were blamed by many for contributing to the build-up of the global financial turmoil, as they allegedly incentivized them to engage in excessive risk-taking. Legislators around the globe decided to...