Suspect CEOs, unethical culture, and corporate misbehavior

• 成果类型: Article
• 署名作者: Biggerstaff, Lee; Cicero, David C.; Puckett, Andy
• 署名单位: University System of Ohio; Miami University; University of Alabama System; University of Alabama Tuscaloosa; University of Tennessee System; University of Tennessee Knoxville
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2014.12.001
• 发表日期: 2015
• 页码: 98-121
• 关键词: Corporate culture; ETHICS; FRAUD; ceo; Option backdating

摘要

We show that firms with Chief Executive Officers (CEOs) who personally benefit from options backdating are more likely to engage in other corporate misbehaviors, suggestive of an unethical corporate culture. These firms are more likely to commit financial fraud to overstate earnings. They acquire more private companies, which could perpetuate their frauds, and their acquisitions are met with lower market responses. These misbehaviors are concentrated in firms with externally hired suspect CEOs, consistent with outside CEOs having greater discretion to shape firm culture. The costs of these misbehaviors are reflected in larger stock price declines during a market correction and increased CEO replacement. (C) 2014 Elsevier B.V. All rights reserved.