Good timing: CEO stock option awards and company news announcements

• 成果类型: Article
• 署名作者: Yermack, D
• 刊物名称: JOURNAL OF FINANCE
• ISSN/ISSBN: 0022-1082
• DOI: 10.1111/j.1540-6261.1997.tb04809.x
• 发表日期: 1997
• 页码: 449-476
• 关键词: FINANCIAL-REPORTING COSTS; corporate governance; incentives; plans; COMPENSATION; association; INFORMATION; INVESTMENT; returns

摘要

This article analyzes the timing of CEO stock option awards, as a method of investigating corporate managers' influence over the terms of their own compensation. In a sample of 620 stock option awards to CEOs of Fortune 500 companies between 1992 and 1994, I find that the timing of awards coincides with favorable movements in company stock prices. Patterns of companies' quarterly earnings announcements are consistent with an interpretation that CEOs receive stock option awards shortly before favorable corporate news. I evaluate and reject several alternative explanations of the results, including insider trading and the manipulation of news announcement dates.