Corporate governance when founders are directors

• 成果类型: Article
• 署名作者: Li, Feng; Srinivasan, Suraj
• 署名单位: University of Michigan System; University of Michigan; Harvard University
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2010.11.006
• 发表日期: 2011
• 页码: 454-469
• 关键词: ceo compensation; ceo turnover; founder; Boards of directors; corporate governance

摘要

We examine chief executive officer (CEO) compensation, CEO retention policies, and mergers and acquisition (M&A) decisions in firms in which founders serve as a director with a nonfounder CEO (founder-director firms). We find that founder-director firms offer a different mix of incentives to their CEOs than other firms. Pay-for-performance sensitivity for nonfounder CEOs in founder-director firms is higher and the level of pay is lower than that of other CEOs. CEO turnover sensitivity to firm performance is also significantly higher in founder-director firms compared with nonfounder firms. Overall, the evidence suggests that boards with founder-directors provide more high-powered incentives in the form of pay and retention policies than the average US board. Stock returns around M&A announcements and board attendance are also higher in founder-director firms compared with nonfounder firms. (C) 2011 Elsevier B.V. All rights reserved.