Session 9

Executives and Incentives

Track A

Date: Saturday, December 15, 2012

 

Time: 15:30 – 16:45

Paper

Room: Meeting Room 2


Session Chair:

  • Weiwen Li, Sun Yat-sen University

Title: Board Composition and Spillovers of Reputational Loss: A Study of China’s Group Firms

Authors

  • Xinran Wang, University of Tennessee
  • Michael Young, Hong Kong Baptist University

Abstract: While it is well known that corruption is rampant in China, less is known about the secondary costs of corruption such as spillover effects. To that end, this study examines the spillover effect on the reputation of innocent group firms when one of their members commits financial fraud. We propose that when a firm commits wrong-doing that there is a “guilt by association” spillover effect for the other firms in the group that negatively impacts their performance and external financing support. Furthermore, we propose that board composition (i.e., proportion of independent directors; multiple board memberships; board ownership) moderates the relationship between financial fraud and spillover effects. To test the hypotheses, we examine all 83 associated innocent group firms in China from 2007 to 2011.

Title: CEO Succession as a Response to Social Capital Losses in an Emerging Economy

Authors

  • Weiguo Zhong, Peking University

Abstract: The effect of CEO succession on firm performance has been an important while controversial topic. While prior research focuses on the human capital perspective, we extend the research from a social capital losses perspective. Specifically, we differentiate the effects of two kinds of social capital losses (self-broken versus alter-broken) on CEO succession origin. We further explore the effect of outsider CEO succession on firm postsuccession firm performance and the contingencies affecting the main effect from the view of social capital losses.

Title: State-Owned Enterprises in China: Party Control, Executive Behaviors, and Organizational Outcomes

Authors

  • Jianyun Tang, Memorial University of Newfoundland

Abstract: In this study I highlight a unique characteristic of the corporate governance of state-owned enterprises (SOEs) in China – that is, SOE executives are essentially cadres of the Communist Party of China (CPC), being appointed and evaluated by the CPC personnel system. From this perspective, I develop a set of tentative hypotheses regarding SOE executive behaviors and thus organizational outcomes. I plan to further refine these hypotheses with in-depth case studies of several SOEs and then quantitatively examine them with a large sample study.

Title: The Incentive Effects of CEO Equity-linked Compensation on Chinese Company Risk Taking

Authors

  • Jing Jin, Rice University

Abstract: By considering multiple reference points, I extend behavioral agency theory into stock ownership evaluation. I then apply my framework in hypothesizing how relative performance changes the risk preferences of executives. I propose that both present value of options and stock returns are negatively associated with risk-taking behaviors. In addition, managers granted with options are prone to engage in more risk-taking activities than managers own stock ownership, when firms experience poor performances. Finally, I posit that past relevant successful/ unsuccessful investment experiences can strengthens/weakens the predicted relationship between the value of stock options/returns of stocks and executive risk-taking activities.

All Sessions in Track A...

Sat: 09:00 – 09:30
Session 35: Conference Welcome
Sat: 09:30 – 10:45
Session 30: Keynote Plenary Panel: Competing and Cooperating in and for China
Sat: 11:15 – 12:30
Session 4: Competition and Adaptation
Session 11: Firm Boundaries and Growth
Session 19: Global Strategy
Session 26: Entrepreneurship in China
Sat: 13:45 – 15:00
Session 31: Plenary Panel II: Collaborative Strategies in and for China
Sat: 15:30 – 16:45
Session 6: CSR and Sustainable Development
Session 7: Entrepreneurship
Session 9: Executives and Incentives
Session 22: Panel: Innovation
Session 24: Managing Innovation Strategies
Sat: 17:00 – 18:15
Session 5: Corporate Governance
Session 8: Evolution and Ecosystems
Session 10: FDI
Session 12: Innovation Strategy
Session 27: FDI and Institutions
Sun: 09:00 – 10:15
Session 32: Plenary Panel III: Corporate Governance and Executive Leadership in the Age of Globalization
Sun: 10:45 – 12:00
Session 13: Institutions
Session 15: Internationalization II
Session 16: Networks
Session 29: Resources and Capabilities
Sun: 13:45 – 15:00
Session 33: Plenary Panel IV: Strategic Management Research in China - What is Next?
Sun: 15:30 – 16:45
Session 3: Alliances and Cooperation
Session 14: Internationalization I
Session 17: Social Capital
Session 28: Governance, Knowledge, and Cooperation
Sun: 17:00 – 18:00
Session 34: Executives Plenary Panel: Innovation Strategy in China


Strategic Management Society

China