Executive stock option vesting conditions, corporate governance and CEO attributes: evidence from Australia
Jenny Stewart and
Accounting and Finance, 2018, vol. 58, issue 2, 503-533
We investigate the association between executive stock option (ESO) vesting conditions, corporate governance and CEO attributes. Using observations from the 250 largest Australian firms, we find that stronger corporate governance is positively associated with the length of the vesting period and the use of performance hurdles. We also find that when CEOs approach retirement, firms are more likely to grant longer timeâ€ vesting options but are less likely to impose performance hurdles. Further, more powerful CEOs appear to influence the granting of ESOs with less restrictive vesting conditions. Our findings suggest that both corporate governance and CEO attributes significantly shape the design of ESOs.
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Persistent link: https://EconPapers.repec.org/RePEc:bla:acctfi:v:58:y:2018:i:2:p:503-533
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