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http://hdl.handle.net/10397/93346
Title: | Is option-based compensation restrained by largest potential risk exposure? Evidence from the banking industry | Authors: | Fung, MK | Issue Date: | Jun-2020 | Source: | Economics letters, June 2020, v. 191, 109084 | Abstract: | Excessive risk taking induced by equity-based executive compensation is more (less) of a concern to the shareholders if the largest potential risk exposure is large (small). This study empirically shows that the intensity of option-based compensation to a bank's CEO decreases with the bank's largest potential risk exposure and its largest potential increase in risk exposure. These findings suggest a possibility of banks self-regulating their compensation structures. | Keywords: | Banking Executive compensation Risk |
Publisher: | Elsevier | Journal: | Economics letters | ISSN: | 0165-1765 | DOI: | 10.1016/j.econlet.2020.109084 | Rights: | © 2020 Elsevier B.V. All rights reserved. © 2020. This manuscript version is made available under the CC-BY-NC-ND 4.0 license https://creativecommons.org/licenses/by-nc-nd/4.0/ The following publication Fung, M. K. (2020). Is option-based compensation restrained by largest potential risk exposure? Evidence from the banking industry. Economics Letters, 191, 109084 is available at https://doi.org/10.1016/j.econlet.2020.109084 |
Appears in Collections: | Journal/Magazine Article |
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Fung_Option-Based_Compensation_Restrained.pdf | Pre-Published version | 795.26 kB | Adobe PDF | View/Open |
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