Compensation regulation in banking: Executive director behavior and bank performance after the EU bonus cap

• 成果类型: Article
• 署名作者: Colonnello, Stefano; Koetter, Michael; Wagner, Konstantin
• 署名单位: Universita Ca Foscari Venezia; Leibniz Association; Leibniz Institut fur Wirtschaftsforschung Halle (IWH); Otto von Guericke University
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2022.101576
• 发表日期: 2023
• 关键词: systemic risk; ceo turnover; FAIL; too; pay; incentives; governance

摘要

The regulation that caps executives' variable compensation, as part of the Capital Re-quirements Directive IV of 2013, likely affected executive turnover, compensation design, and risk-taking in EU banking. The current study identifies significantly higher average turnover rates but also finds that they are driven by CEOs at poorly performing banks. Banks indemnified their executives by off-setting the bonus cap with higher fixed compensation. Although our evidence is only suggestive, we do not find any reduction in risk-taking at the bank level, one purported aim of the regulation.& COPY; 2022 Elsevier B.V. All rights reserved.