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Relying on proprietary Canadian data, we determine a positive relationship between the level of Canadian CEO compensation and the existence of significant international components among a CEO’s array of responsibilities. Our findings are consistent with agency and human capital theoretical arguments. Results imply that executive pay premiums should be anticipated and budgeted for in the planning and implementation of international ventures.

The purpose of this paper is to present an approach to quantify the monetary value of job security.

The paper is theoretical and based on a financial economics human capital model. Empirical estimates of the annualized value of job security at three large corporations and at the government of the USA are also developed for an illustrative employee profile.

A financial economics human capital model can be used to derive a lower‐bound estimate for the monetary value of job security and empirical estimates can be calculated straightforwardly to help managers who allocate economic resources to fulfill organizational labor requirements or negotiate labor agreements.

The model presented provides a lower‐bound estimate only. Future research could suggest approaches to calculate more precise estimates.

This paper provides a tool for managers and workers who wish to include the monetary value of relative job security in the definition of total compensation during the negotiation of employment conditions or while benchmarking total compensation.

This paper is a pioneer contribution in the field of quantifying the monetary value of job security.

The purpose of this paper is to explain an economic incentive to manage earnings derived from the intersection of disclosure theory and equity theory and to discuss its behavioral implications.

This is a theoretical paper.

A taxonomy of possible managerial reactions to increased disclosure regulation shows that deception (e.g. earnings management) bears relatively low‐situational‐ethics and high‐situational‐risk.

The taxonomy suggests that deceptive behavior would be better explained by broadening the traditional agency model with a situational ethics component and by relaxing its risk‐aversion assumption.

Theoretical findings suggest that the implementation of additional mandatory disclosure is not an appropriate strategy to limit earnings management in a context where the production of information is implicitly costly for managers, and where information asymmetry exists between managers and investors. However, regulations that raise managers’ awareness regarding personal risks involved with earnings management, such as the Sarbanes‐Oxley Act, appear likely to reduce the prevalence of earnings management.

This paper is one of the first to focus on economic incentives, ethical considerations, and personal risk considerations simultaneously.

This chapter examines the sensitivity of executive incentive compensation to market-adjusted returns and changes in earnings for high-tech (HT) firms vis-à-vis firms (NHT) in other industries. Consistent with the hypotheses, this chapter uncovers the following evidence: First, the sensitivity of executive bonus compensation to market-adjusted returns is weaker and more symmetric for HT firms than for NHT firms (a control group), which implies that the problem of ex post settling up, documented in Leone et al. (2006), may be far less serious in HT firms than in NHT firms. Second, the sensitivity of executive incentive compensation to earnings changes is generally more symmetric for HT firms than for NHT firms, which is consistent with the view that HT firms engage in more conservative financial reporting than NHT firms. Third, the sensitivity of executive equity-based compensation to market-adjusted returns is significantly negative for HT firms compared to NHT firms when bad earnings news is announced. The results imply that HT firms, with a strong motive to attract and retain their highly talented executives, judiciously use both short-term and long-term incentive compensation schemes by compensating for a reduction of short-term incentive pay with an increase in long-term incentive pay. The issue of executive compensation has been a longstanding one in the United States and Canada, and the issue of executive compensation-performance sensitivity for HT firms is also relevant in this era of the information technology (IT) revolution, especially when prior research has shown that HT firms differ from NHT firms in their market-valuation process.