When do stock options affect CEO risk-taking? The moderating role of CEO regulatory focus

IF 2.2 3区管理学 Q2 BUSINESS, FINANCE

Journal of Business Finance & Accounting Pub Date : 2023-10-30 DOI:10.1111/jbfa.12762

Yenn-Ru Chen, Tuck Siong Chung, Chia-Hsien Lin, Angie Low

引用次数: 0

Abstract

Executive stock options are provided to risk-averse CEOs to encourage risk-taking. We show that the efficacy of such stock options is moderated by CEOs’ regulatory focus—their intrinsic motivations to avoid losses or achieve gains. We show that stock options have a negligible impact on the risk-taking behavior of CEOs who are intrinsically motivated to avoid losses or take on risks. The impact of stock options on firm risk is strongest among CEOs whose regulatory focus is moderate and whose behavior is thus more malleable. Our paper shows that CEO intrinsic risk-taking motivations have important implications for the effectiveness of extrinsic risk-taking incentives provided by stock options.

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股票期权何时影响首席执行官的风险承担？首席执行官监管重点的调节作用

向规避风险的首席执行官提供高管股票期权是为了鼓励他们承担风险。我们的研究表明，这种股票期权的效果受首席执行官的监管重点--他们避免损失或获得收益的内在动机--的影响。我们的研究表明，股票期权对那些内在动机是避免损失或承担风险的首席执行官的风险承担行为的影响微乎其微。股票期权对公司风险的影响在那些监管重点适中、因而行为更具可塑性的首席执行官中最为明显。我们的论文表明，首席执行官内在的风险承担动机对股票期权提供的外在风险承担激励的有效性有重要影响。

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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来源期刊

Journal of Business Finance & Accounting BUSINESS, FINANCE-

CiteScore

4.40

自引率

17.20%

发文量

期刊介绍： Journal of Business Finance and Accounting exists to publish high quality research papers in accounting, corporate finance, corporate governance and their interfaces. The interfaces are relevant in many areas such as financial reporting and communication, valuation, financial performance measurement and managerial reward and control structures. A feature of JBFA is that it recognises that informational problems are pervasive in financial markets and business organisations, and that accounting plays an important role in resolving such problems. JBFA welcomes both theoretical and empirical contributions. Nonetheless, theoretical papers should yield novel testable implications, and empirical papers should be theoretically well-motivated. The Editors view accounting and finance as being closely related to economics and, as a consequence, papers submitted will often have theoretical motivations that are grounded in economics. JBFA, however, also seeks papers that complement economics-based theorising with theoretical developments originating in other social science disciplines or traditions. While many papers in JBFA use econometric or related empirical methods, the Editors also welcome contributions that use other empirical research methods. Although the scope of JBFA is broad, it is not a suitable outlet for highly abstract mathematical papers, or empirical papers with inadequate theoretical motivation. Also, papers that study asset pricing, or the operations of financial markets, should have direct implications for one or more of preparers, regulators, users of financial statements, and corporate financial decision makers, or at least should have implications for the development of future research relevant to such users.