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The impact of CEO option grants on firm value: Determinants of the effectiveness of option grants.

机译:CEO期权授予对公司价值的影响:期权授予有效性的决定因素。

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摘要

The significance of stock options as a component of executive compensation has fluctuated dramatically over the past decade. The purpose of this study is to investigate determinants of the effectiveness of stock option grants. These option grants are considered to be effective if they accomplish their intended role of enhancing firm value by inducing risk-taking behavior.;Using data from 2,349 firms that granted stock options to their Chief Executive Officer (CEO) between 1992 and 2001, the relationship between the options granted and subsequent firm value was examined. This study found no universal positive association between option grants and firm value. However, CEO incentive equilibrium, defined as stability in the CEO's stock and option portfolio sensitivity to stock price, was found to influence the association between stock option grants and firm value. The positive association between grants and firm value was evidenced for the sub-sample of firms that demonstrate disequilibrium in CEO incentives. This was not the case, however, for the CEO incentive equilibrium sub-sample. This finding indicates that the positive valuation impact of stock option grants is highest for those firms that demonstrate a trend of increasing CEO portfolio sensitivity to stock price.;High CEO portfolio sensitivity to equity risk was not found to interact with grant sensitivity to equity risk in a manner that reduces firm value. Thus, this study did not find support for the hypothesis that, ceteris paribus, grants further reduce CEO diversification, and interact with portfolio sensitivity to reduce incentives for risk-taking. Consistent with Lambert, Larcker and Verrecchia (1991), however, a high level of uncorrelated wealth is found to interact with grant sensitivity to equity risk so as to increase the positive impact of grant sensitivity on firm value.
机译:在过去十年中,股票期权作为高管薪酬组成部分的重要性发生了巨大的变化。这项研究的目的是调查决定股票期权授予有效性的决定因素。如果这些期权授予通过诱使冒险行为来实现其增强公司价值的预期作用,则被认为是有效的;使用1992年至2001年间向其首席执行官授予股票期权的2349家公司的数据,这种关系在授予的期权和随后的公司价值之间进行了检验。这项研究发现,期权授予与公司价值之间没有普遍的正相关关系。但是,发现首席执行官激励均衡(定义为首席执行官股票的稳定性和期权组合对股票价格的敏感性)会影响股票期权授予与公司价值之间的关联。赠款与公司价值之间存在正相关关系,这证明了企业子样本显示出CEO激励失衡。但是,对于CEO激励均衡子样本而言,情况并非如此。该发现表明,对于那些表现出CEO投资组合对股票价格敏感度呈上升趋势的公司而言,股票期权授予的正估值影响最大。一种降低公司价值的方式。因此,这项研究没有找到支持以下假设的支持,即:“同等权益”会进一步减少CEO的多元化,并与投资组合敏感度互动以减少冒险的动机。然而,与Lambert,Larrker和Verrecchia(1991)一致,发现大量不相关的财富与赠款敏感性对股票风险的相互作用,从而增加了赠款敏感性对公司价值的积极影响。

著录项

  • 作者

    Weber, Catherine Krueger.;

  • 作者单位

    Texas A&M University.;

  • 授予单位 Texas A&M University.;
  • 学科 Education Curriculum and Instruction.
  • 学位 Ph.D.
  • 年度 2006
  • 页码 102 p.
  • 总页数 102
  • 原文格式 PDF
  • 正文语种 eng
  • 中图分类 教育;
  • 关键词

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