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Do lucrative executive pensions make management more conservative?
Drawing on research by Sundaram and Yermack, the study reveals that CEOs with substantial pension entitlements tend to adopt more conservative strategies to protect their deferred compensation. Analyzing data from 237 Fortune 500 companies (1996–2002), the authors found that older CEOs with higher pension values (averaging $8.6 million at age 65) were more likely to avoid risky investments, reduce leverage, and extend debt maturity to minimize firm risk. This behavior aligns with safeguarding their unsecured pension claims, which resemble corporate debt obligations. The study highlights a divergence between executive and shareholder interests, as risk-averse management may hinder growth opportunities. Notably, CEOs with equity-heavy compensation (e.g., stock options) exhibited greater risk-taking compared to those with pension-weighted packages. The findings underscore the need for transparency in deferred compensation and further research on how inside debt shapes corporate strategy, CEO succession, and mergers. The article concludes that executive pensions, often overlooked in compensation studies, play a critical role in managerial conservatism and warrant closer scrutiny in governance frameworks.
Ketersediaan
| Call Number | Location | Available |
|---|---|---|
| AMP2201 | PSB lt.dasar - Pascasarjana | 1 |
| Penerbit | Briarcliff Manor, NY: Academy of Management 2008 |
|---|---|
| Edisi | Vol. 22, No. 1, Feb., 2008 |
| Subjek | Corporate governance Risk-taking Behavior executive pensions management conservatism Supplemental Executive Retirement Plans (SERPs) executive retirement incentives |
| ISBN/ISSN | 15589080 |
| Klasifikasi | NONE |
| Deskripsi Fisik | 3 p. |
| Info Detail Spesifik | Academy of Management Perspectives |
| Other Version/Related | Tidak tersedia versi lain |
| Lampiran Berkas |