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Executive stock option compensation: The corporate reporting decision
Author(s) -
Lewellen Wilbur,
Park Taewoo,
Ro Byung
Publication year - 1995
Publication title -
managerial and decision economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.288
H-Index - 51
eISSN - 1099-1468
pISSN - 0143-6570
DOI - 10.1002/mde.4090160606
Subject(s) - executive compensation , stock options , proxy (statistics) , accounting , stock (firearms) , business , sample (material) , non qualified stock option , actuarial science , financial statement , restricted stock , finance , corporate governance , audit , stock market , statistics , mechanical engineering , paleontology , chemistry , chromatography , horse , engineering , biology , mathematics
Abstract New regulations instituted in 1992 by the SEC require that estimates of the values of executive stock option grants now be included in proxy statement reports on senior executive compensation. We examine the character of firms' reporting choices under the new rules, from a large sample of the first round of proxy statements issued. We find that the majority of firms have elected a reporting approach that provides little additional information to investors, and appear at least in part to have done so because the alternative approach would have caused them to report above‐average stock option compensation amounts for their executives.