Equity-based compensation and the timing of share repurchases: the role of the corporate calendar

Ingolf Dittmann, Amy Yazhu Li, Stefan Obernberger and Zheng, Jiaqi (Jacky)

Journal of Accounting and Economics, 2025, vol. 80, issue 1

Abstract: We examine whether CEOs use share repurchases to sell their equity at inflated prices. We document that share repurchases, like equity-based compensation, are affected by the corporate calendar—the firm's schedule of earnings announcements and insider trading restrictions. The corporate calendar can fully explain why share repurchases and equity-based compensation coincide. The alignment with the corporate calendar is stricter in firms with strong internal governance or high external monitoring. When CEOs sell equity, firms are actually less likely to repurchase. Our findings reconcile earlier studies and highlight the importance of the corporate calendar for the timing of share repurchases.

Keywords: Payout policy; Share repurchases; Quarterly earnings announcement; Equity-based compensation; Insider trading; Fiscal calendar (search for similar items in EconPapers)
JEL-codes: G14 G35 M12 M41 M52 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jaecon:v:80:y:2025:i:1:s0165410125000345

DOI: 10.1016/j.jacceco.2025.101798

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