CEO Turnover, Financial Distress, and Contractual Innovations

• 成果类型: Article
• 署名作者: Evans, John Harry, III; Luo, Shuqing; Nagarajan, Nandu J.
• 署名单位: Pennsylvania Commonwealth System of Higher Education (PCSHE); University of Pittsburgh; National University of Singapore
• 刊物名称: ACCOUNTING REVIEW
• ISSN/ISSBN: 0001-4826
• DOI: 10.2308/accr-50688
• 发表日期: 2014
• 页码: 959-990
• 关键词: CORPORATE GOVERNANCE; MANAGEMENT TURNOVER; firm performance; bankruptcy; COMPENSATION; INFORMATION; MARKET; logit; COSTS

摘要

The design of CEO incentives is particularly important for firms in financial distress. We compare the resolution of CEO incentive problems in distressed firms between the 1980s versus the 1990s, focusing on how changes in contractual provisions, as well as in the executive labor market, resulted in a shift to a new equilibrium. Our analyses provide evidence that the increased bargaining power of creditors, together with changes in the use of contractual provisions in the 1990s, enabled creditors to more effectively retain highly skilled CEOs with firm-specific knowledge and provide them with incentives to improve firm performance.