Proceedings of the 3rd International Conference on Economy, Management and Entrepreneurship (ICOEME 2020)

Executive Compensation & Companies’ Soft and Hard Investment

Authors
Dongxu Yang, Shizhong Xiong, Tian Tan
Corresponding Author
Dongxu Yang
Available Online 8 September 2020.
DOI
https://doi.org/10.2991/aebmr.k.200908.008How to use a DOI?
Keywords
executive compensation, managerial decision, risk taking behavior, corporate strategy
Abstract

Executive Compensation is a critical issue today, since executives’ decisions, motivated by compensation incentives, critically affect firms’ value and stakeholders’ interest. Consistent with prior literature, we have documented a positive (negative) relationship between Vega (Delta) from executive option holding and firm’s R&D spending, which is a proxy for risk-taking. This paper incrementally documents that Vega will not only incentivize R&D, but also it will increase firm’s capital expenditure on a relative weaker scale, because investment with more tangibility will be less risky. Moreover, the results denoted that top management team’s (excluding CEO) compensation incentives contribute to the corporate decision in the same manner as CEO’s incentive does. Lastly, the results for post-2006 period are qualitatively the same as pre-2006 period.

Copyright
© 2020, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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Volume Title
Proceedings of the 3rd International Conference on Economy, Management and Entrepreneurship (ICOEME 2020)
Series
Advances in Economics, Business and Management Research
Publication Date
8 September 2020
ISBN
978-94-6239-052-2
ISSN
2352-5428
DOI
https://doi.org/10.2991/aebmr.k.200908.008How to use a DOI?
Copyright
© 2020, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Cite this article

TY  - CONF
AU  - Dongxu Yang
AU  - Shizhong Xiong
AU  - Tian Tan
PY  - 2020
DA  - 2020/09/08
TI  - Executive Compensation & Companies’ Soft and Hard Investment
BT  - Proceedings of the 3rd International Conference on Economy, Management and Entrepreneurship (ICOEME 2020)
PB  - Atlantis Press
SP  - 48
EP  - 53
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.200908.008
DO  - https://doi.org/10.2991/aebmr.k.200908.008
ID  - Yang2020
ER  -