Quid-pro-quo exchanges of outside director defined benefit pension plans for equity-based compensation

dc.contributor.author Campbell, Cynthia
dc.contributor.author Campbell, Cynthia
dc.contributor.author Power, Mark
dc.contributor.author Stover, Roger
dc.contributor.department Finance
dc.date 2018-02-13T13:12:15.000
dc.date.accessioned 2020-06-30T03:57:54Z
dc.date.available 2020-06-30T03:57:54Z
dc.date.copyright Sun Jan 01 00:00:00 UTC 2006
dc.date.embargo 2013-07-31
dc.date.issued 2006-11-01
dc.description.abstract <p>The independence of outside directors is critical to corporate board effectiveness. We examine a unique period in corporate governance when outside directors' defined benefit pensions are replaced with increases in equity. Firms with pension plans significantly underperform their industry in terms of stock returns. Firms terminating the pension plans in exchange for equity have significant increases in stock returns relative to their industry subsequent to the change. All samples outperform the ROA and ROE industry medians both before and after the change in compensation, indicating pressure from organized investors likely comes from stock performance, not accounting performance. Investor rights pressure and outside director compensation and not takeover risk or institutional ownership best explain firms altering outside director compensation, with board of director effectiveness improving.</p>
dc.description.comments <p>This article is from <em>Journal of Pension Economics and Finance</em>, 5, no. 2 (2006): 155–174, doi:<a href="http://dx.doi.org/S1474747206002472" target="_blank">10.1017/S147474720600247</a>2.</p>
dc.format.mimetype application/pdf
dc.identifier archive/lib.dr.iastate.edu/finance_pubs/1/
dc.identifier.articleid 1000
dc.identifier.contextkey 4370068
dc.identifier.s3bucket isulib-bepress-aws-west
dc.identifier.submissionpath finance_pubs/1
dc.identifier.uri https://dr.lib.iastate.edu/handle/20.500.12876/37318
dc.language.iso en
dc.source.bitstream archive/lib.dr.iastate.edu/finance_pubs/1/Campbell_Director_Pension_Equity_based_Compensation.pdf|||Fri Jan 14 17:28:24 UTC 2022
dc.source.uri 10.1017/S1474747206002472
dc.subject.disciplines Finance and Financial Management
dc.title Quid-pro-quo exchanges of outside director defined benefit pension plans for equity-based compensation
dc.type article
dc.type.genre article
dspace.entity.type Publication
relation.isAuthorOfPublication 903095ab-a514-457c-a055-b85e33625148
relation.isOrgUnitOfPublication e2432527-158f-465f-8301-f4ab4c262f9b
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