Accounting Papers

Document Type

Journal Article

Date of this Version

4-2008

Publication Source

Journal of Financial Economics

Volume

88

Issue

1

Start Page

1

Last Page

25

DOI

10.1016/j.jfineco.2007.05.001

Abstract

We examine the press’ role in monitoring and influencing executive compensation practice using more than 11,000 press articles about CEO compensation from 1994 to 2002. Negative press coverage is more strongly related to excess annual pay than to raw annual pay, suggesting a sophisticated approach by the media in selecting CEOs to cover. However, negative coverage is also greater for CEOs with more option exercises, suggesting the press engages in some degree of “sensationalism.” We find little evidence that firms respond to negative press coverage by decreasing excess CEO compensation or increasing CEO turnover.

Copyright/Permission Statement

© 2008. This manuscript version is made available under the CC-BY-NC-ND 4.0 license http://creativecommons.org/licenses/by-nc-nd/4.0/

Keywords

press, media, executive compensation, corporate governance

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Date Posted: 27 November 2017

This document has been peer reviewed.