Xu, Moqi (2014) Towards the end of any long-term incentive program for CEOs, the short term awaits – but it doesn’t need to be bad news. USApp– American Politics and Policy Blog (17 Nov 2014). Website.
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Abstract
After the financial crisis, shareholders and regulators have become increasingly concerned about short-term pressures in business decision-making. Moqi Xu examines two potential remedies that firms use to set long-term incentives and what happens when they eventually run out. When long-term compensation eventually becomes available to executives, it rewards them for extremely short-term behaviour, such as timing news releases for their own personal benefit. When long-term employment contracts come close to the renewal decision, by contrast, executives are exposed to the scrutiny of the board, which forces them to focus and commercialize long-term investments previously made.
| Item Type: | Online resource (Website) |
|---|---|
| Official URL: | http://blogs.lse.ac.uk/usappblog/ |
| Additional Information: | © 2014 The Author, USApp– American Politics and Policy Blog, The London School of Economics and Political Science |
| Divisions: | Finance Financial Markets Group |
| Subjects: | H Social Sciences > HB Economic Theory H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management |
| JEL classification: | M - Business Administration and Business Economics; Marketing; Accounting > M5 - Personnel Economics > M52 - Compensation and Compensation Methods and Their Effects (stock options, fringe benefits, incentives, family support programs, seniority issues) |
| Date Deposited: | 03 Dec 2014 16:06 |
| Last Modified: | 11 Dec 2024 13:48 |
| URI: | http://eprints.lse.ac.uk/id/eprint/60434 |
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