Option Backdating and Board Interlocks

• 成果类型: Article
• 署名作者: Bizjak, John; Lemmon, Michael; Whitby, Ryan
• 署名单位: Portland State University; Utah System of Higher Education; University of Utah; Hong Kong University of Science & Technology; Texas Tech University System; Texas Tech University
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhn120
• 发表日期: 2009
• 页码: 4821
• 关键词: DIRECTORS; governance; awards

摘要

We examine the role of board connections in explaining how the controversial practice of backdating employee stock options spread to a large number of firms across a wide range of industries. The increase in the likelihood that a firm begins to backdate stock options that can be explained by having a board member who is interlocked to a previously identified backdating firm is approximately one-third of the unconditional probability of backdating in our sample. Our analysis provides new insight into how boards function and the role that they play in providing managerial oversight and determining corporate strategy. (JEL G30, G32, G38, J33)