This paper is a case study of Fannie Mae's executive compensation arrangements during the period 2000-2004. We identify and analyze four problems with these arrangements:- First, by richly rewarding executives for reporting higher earnings, without requiring return of the compensation if...

This Article analyzes an important form of stealth compensation provided to managers of public companies. We show how boards have been able to camouflage large amounts of executive compensation through the use of retirement benefits and payments. Our study illustrates the significant role that...

This paper provides an overview of the main theoretical elements and empirical underpinnings of a managerial power approach to executive compensation. Under this approach, the design of executive compensation is viewed not only as an instrument for addressing the agency problem between managers...

This paper develops an account of the role and significance of managerial power and rent extraction in executive compensation. Under the optimal contracting approach to executive compensation, which has dominated academic research on the subject, pay arrangements are set by a board of directors...

Executive compensation and corporate governance problems need to be seen in a larger historical context than is commonly done. The proximate causes of corporate scandals and executive pay problems have been identified, but the real drivers have not. A need for corporate restructuring, which...

It is a commonplace of American law that corporations are fictional. This is silly - corporations are all too-real (after all, most of us work for one, most of the physical goods on which we depend are made by them, the quality (and lack of quality) of our physical environment is dependent on...

Taxation and corporate governance interact in various ways. Tax law influences corporate governance structures in companies by offering tax privileges or imposing penalties. On the other hand actual corporate governance structures in place have an impact on the way companies manage their tax...

Proponents of board reforms assume that corporate structures and director-specific provisions matter. This paper argues that reformers have set minimum standards, but failed to take into accounts various trade-offs and regulatory capture effects. It is thus suggested to increase the flexibility...

This article analyzes and critiques the federal securities laws' reliance on disclosure as the primary method of protecting investors and regulating the securities markets. Since the inception of the federal securities law seventy years ago, the policy has always been that, as long as...

This article is the second chapter of a book authored by R. Kraakman, P. Davies, H. Hansmann, G. Hertig, K. Hopt, H. Kanda, and E. Rock, quot;The Anatomy of Corporate Law: A Comparative and Functional Approach,quot; (Oxford University Press 2004). The book as a whole provides a functional...