Changing the Blame Game: Does the Presence of a Pay Ratio Disclosure Impact Nonprofessional Investors’ Reactions to CEOs’ Internal Attributions for Poor Firm Performance?

Nicole L. Cade, S. Kaplan, S. Loftus
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Abstract

We conduct two experiments to investigate how the presence of the CEO pay ratio, a recently mandated disclosure, influences nonprofessional investors’ reactions to a CEO’s internal attributions for poor firm performance. Results of our first experiment suggest that relative to blaming oneself, blaming other firm employees for poor firm performance more effectively absolves a CEO from responsibility for poor firm performance and damages perceptions of the CEO’s trustworthiness less when a pay ratio disclosure is present versus absent. These perceptions, in turn, affect investors’ support for the CEO’s compensation and the company’s attractiveness as an investment. Our second experiment provides evidence of the underlying process, showing the pay ratio disclosure and the CEO’s attribution to other employees affects the perceived status of a CEO. Together, our findings inform managers about the impact of their attributions for poor firm performance and regulators about potential unintended consequences of pay ratio disclosures.
改变指责游戏:薪酬比率披露的存在是否会影响非专业投资者对首席执行官对公司业绩不佳的内部归因的反应?
我们进行了两个实验,以调查CEO薪酬比率(最近强制要求披露的一项信息)的存在如何影响非专业投资者对CEO将公司业绩不佳归咎于内部因素的反应。我们的第一个实验结果表明,相对于责备自己,责备其他公司员工对公司业绩不佳的责任更有效地免除了CEO对公司业绩不佳的责任,并且当薪酬比率披露存在时,损害CEO可信度的程度要小于不披露时。这些看法反过来又影响投资者对CEO薪酬的支持,以及公司作为投资的吸引力。我们的第二个实验提供了潜在过程的证据,表明薪酬比率披露和CEO对其他员工的归因影响了CEO的感知地位。总之,我们的研究结果让管理者了解了他们对公司业绩不佳的归因的影响,也让监管机构了解了薪酬比率披露可能带来的意外后果。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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