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RESEARCH: Trends in CEO Compensation and Equity Holdings for S&P 1,500 Firms: 1994-2007

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1505071

Date posted: November 14, 2009

Richard A. Lord Montclair State University - School of Business and Yoshie Saito Georgia College & State University - Department of Accounting

Trends in CEO Compensation and Equity Holdings for S&P 1,500 Firms: 1994-2007
 
Abstract:     
We analyze CEO pay and equity holdings for the S&P 1,500 and broad industry classes. Between 1994 and 2000 real annual compensation doubled, and there was a dramatic shift from salary to option grants. The value and proportion of CEO equity holdings and the price-performance-sensitivity of their portfolios also increased, but, managers held less shares and more options. After the crash of the dot.com bubble at the turn-of-the-century pay fell briefly. But, it then began to trend upward again through 2007. Since 2001 option grants have declined notably, replaced largely by restricted stock grants. In the most recent years CEO option holdings and the price-performance-sensitivity of their equity portfolios have declined to levels far below those in 1994.

 

Keywords: CEO Compensation, Equity Holding, Price-Performance-Sensitivity, Industry Analysis

JEL Classifications: J33, G30, M40

Accepted Paper Series

Date posted: November 14, 2009 ; Last revised: November 14, 2009

Suggested Citation

Lord, Richard A. and Saito, Yoshie, Trends in CEO Compensation and Equity Holdings for S&P 1,500 Firms: 1994-2007 (November 9, 2009). Journal of Applied Finance, Forthcoming . Available at SSRN: http://ssrn.com/abstract=1505071

Contact Information
Yoshie Saito (Contact Author)
Georgia College & State University - Department of Accounting ( email )
Milledgeville, GA 31061-0490
United States
Richard A. Lord
Montclair State University - School of Business ( email )
Upper Montclair, NJ 07043
United States
973-655-7448 (Phone)
973-655-7629 (Fax)

Edited Tue, Mar 30, 2010 11:00 AM

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