IDEAS home Printed from https://ideas.repec.org/a/eee/jbfina/v160y2024ics0378426623002753.html
   My bibliography  Save this article

Risk-taking incentives and risk-talking outcomes

Author

Listed:
  • Mishra, Dev R

Abstract

CEOs’ option-based compensation and discussions about political risk (risk-talking) in successive earnings conference calls are significantly positively associated. This effect is more significant in the subsample of firms with less equity price volatility and poor investment risk-taking (lower capital expenditure). Furthermore, seven out of eight components of risk-talking are positively related to CEOs’ option-based compensation. These findings suggest that CEOs with more options in compensation packages are likely to find discussing political risk during corporate earnings calls as a viable alternative to boost proxies of risk-taking outcomes (such as equity price volatility), especially when they perceive risk-taking expectations to be untenable.

Suggested Citation

  • Mishra, Dev R, 2024. "Risk-taking incentives and risk-talking outcomes," Journal of Banking & Finance, Elsevier, vol. 160(C).
    • Handle: RePEc:eee:jbfina:v:160:y:2024:i:c:s0378426623002753
    DOI: 10.1016/j.jbankfin.2023.107080
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0378426623002753
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jbankfin.2023.107080?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    CEO compensation; Executive options; Risk-taking incentives; Political risk; Earnings conference calls;
    All these keywords.

    JEL classification:

    • G3 - Financial Economics - - Corporate Finance and Governance
    • M1 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration
    • M4 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jbfina:v:160:y:2024:i:c:s0378426623002753. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/jbf .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.