Search results

Relates previous research on the importance of age in decision‐making to Fama and Jensen’s (1983) ideas on decision management, develops hypotheses on the age of managers and the use of stock‐based compensation in companies with long time horizons (i.e. growth companies) and tests them on 1979‐1987 data for a sample of US firms. Explains the methodology used and presents the results, which show that these firms tend to have younger subordinate executives (but not younger CEOs) and to use less stock‐based compensation the younger these executives are. Suggests this is because younger executives effectively extend the time horizon of older CEOs, thus reducing the need to do this through the compensation package.

The motive to manage impressions has been broken down into protective and acquisitive orientations. A protective orientation exists when an individual is concerned primarily with encountering disapproval, rather than approval, from the relevant audience. An acquisitive orientation exists when an individual is concerned primarily with obtaining approval from the audience. This study tests the proposition that organizational managers have primarily an acquisitive orientation. The affective sentiments of 95 international middle‐ and upper‐level business managers toward their organization, its leaders, and its business control mechanisms were compared with their perceptions of the acquisitiveness and protectiveness of their work environment. The results indicate that affective sentiments of managers are correlated with the acquisitiveness, but not the protectiveness, of the work environment, supporting the notion that managers have primarily an acquisitive orientation.

An inverse relation between performance and managerial turnover at Japanese firms suggests that bank monitoring substitutes for other governance mechanisms (Kaplan, 1994; Kang & Shivdasani, 1995). Morck and Nakamura (1999), however, report that Japanese banks protect their self-interests as creditors rather than the interests of shareholders when appointing corporate directors. We re-examine data on top management changes at Japanese firms and find results consistent with this latter notion. Specifically, management turnover is conditionally related to a firm’s ability to meet its short-term obligations rather than profitability or stock returns. Bank monitoring is therefore not a substitute for mechanisms that directly serve shareholders’ interests.

This paper provides a review of research on financial derivatives, with an emphasis on and comprehensive coverage of research published in 15 top accounting journals from 1996 to 2017. We begin with some brief institutional details about derivatives and then summarize studies explaining when and why firms use derivatives. We then discuss the evolution of the accounting rules related to derivatives (and associated disclosure requirements) and studies that examine changes in these requirements over the years. Next, we review the literature that examines the consequences of firms’ derivative use to various capital market participants (i.e., managers, analysts, investors, boards of directors, etc.), with an emphasis on the role that the accounting and disclosure rules play in such consequences. Finally, we discuss the importance of industry affiliation on firms’ derivative use and the role that industry affiliation plays in derivatives research. Overall, our review suggests that, perhaps due to their inherent complexity and data limitations, derivatives are relatively understudied in accounting, and we highlight several areas where future research is needed.

For work organizations and their members, establishing and maintaining mutually satisfying employment relationships is a fundamental concern. The importance that scholars attach to employment relationships is reflected in research streams that explore the optimal design of strategic human resource management systems, the nature of psychological contract fulfillment and violation, and the factors associated with achieving person-environment fit, among others. Generally missing from theory and research pertaining to employment relationships is the perspective of individuals who reside at the employee-employer interface – managerial leaders. We argue that, for managerial leaders, a pervasive concern involves the tangible and intangible resource requirements of specific employees. We then provide the groundwork for study of the leader’s perspective on employment relationships by proposing a model that identifies how employees come to be perceived as low versus high maintenance and how these perceptions, in turn, influence leader cognition, affect, and behavior.

This study examines the effects of narcissism and bonus-based incentive plans on managerial decision-making performance. Using an experiment, the authors first examine decision choices under two levels of an incentive threshold (high and low). Narcissism is measured using the Narcissistic Personality Inventory (NPI). Typically, the NPI is used as a single monolithic construct in analyses; however, in this study, the authors subdivide it in two ways to gain more nuanced information about its impact on decision making. First, the authors split the NPI into three levels – high, medium, and low (Hascalovitz & Obhi, 2015), and then decompose it into its adaptive and maladaptive components (Campbell, Hoffman, Campbell, & Marchisio, 2011) to examine how these subdivisions affect performance. Results show that the different levels of incentive thresholds affect performance among narcissistic individuals. Results indicate that individuals higher in narcissism and higher in levels of adaptive and maladaptive narcissism outperform their low-trait counterparts in a lower-threshold environment, but not in a high threshold environment.

Numerous empirical studies have been conducted to analyze the impact of board gender diversity (BGD) on firm performance without being able to establish a clear relationship. In this paper, we reassess the relationship between BGD and firm performance by using a quantile regression approach. Our results indicate that BGD matters only across a subset of the firm performance distribution. Moreover, when the possible endogeneity of the relationship between BGD and firm performance is taken into account, there are some conditions under which a positive and significant relationship is observed for the eight lowest quantiles.