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The purpose of this paper is to examine the relationship of CEO compensation plans and the risk of managerial equity portfolios with the extent of strategic investments in advertising, capital expenditures and research and development (R&D). The elements of compensation are salary, bonuses, options and restricted stock grants. The authors proxy the design of CEO equity portfolios by the price performance sensitivity of the holdings and the portfolio deltas.

The authors use the components of executive compensation and portfolio risk as the dependent variables, regressing these against measures for the level of strategic investment. The authors test for non-linear relationships between the components of CEO compensation and strategic investments. The sample is a broad cross-section from 1992 to 2016.

The authors find strong support for non-linear relationships of capital expenditures and R&D with CEO bonuses, option grants and restricted stock grants. There are very complex relationships between the components of executive compensation and R&D expenditures, but little evidence of a relationship with advertising expenditures. The authors also find strong complex relationships in the design of CEO equity portfolios with advertising and R&D.

Little earlier research has considered advertising, capital expenditures and R&D in a unified framework. Also, testing for non-linear associations provides much greater insight into the relationship between the components of executive compensation and strategic investment. The findings represent a valuable incremental contribution to the executive compensation literature. The results also have normative policy implications for compensation committees’ design of optimal annual CEO compensation packages to incentivize or discourage particular strategic investment behavior.

The purpose of this paper is to reexamine the corporate focus hypothesis to establish the characteristics of firms that discontinue operations. The authors concentrate on four interrelated elements of the hypothesis, diversification, performance, financial constraint and market-based risk measures. The authors also examine whether firms reporting positive- or negative-valued discontinued operations have different characteristics.

Analyzing discontinued operations provides a broad sample of strategically important exit decisions using a variety of different disposal methods. The authors use logistic regression models to explore whether the elements of the corporate focus hypotheses, and interactions between them, explain decisions to discontinue operations, and also the differences between firms making negative- and positive-valued announcements.

Firms that discontinue operations are more diverse, with weak operating performance, higher financial constraints and perform poorly in financial markets. Interrelationships between these factors strongly affect exit decisions. Companies reporting negative-valued discontinued operations are smaller, make lower capital investments and face greater cash constraints and market risk. Those announcing positive-valued discontinuations are larger and make higher payouts and capital expenditures. Their overall performance is weaker than for control firms, but clearly superior to companies discontinuing negative-valued operations.

Discounted operations represent a wide range of exit decisions. They provide a much larger sample than most previous studies of divestitures. The authors include β, the Sharpe ratio, cash holdings, payouts to shareholders, capital expenditures and also cross-product terms between the elements of the corporate focus hypothesis, all of which have received little attention in prior research. There are significant differences between firms announcing positive and negative-valued discontinued operations.

The survival rate of newly listed firms is low, and there is evidence of a surge of poorly performing new listed firms leading up to the crash of the dot.com bubble. The author investigates this phenomenon and analyzes investors' ability to understand the quality of accounting information and to adjust their expectations.

The author employs the dividend discount model in conjunction with clean surplus accounting discussed by Ohlson (1995) to compare the value relevance of earnings and research and development (R&D) expenditures for short and longer listed National Association of Security Dealer Automated Quotations (NASDAQ) firms between 1980 and 2014. The author also uses univariate tests and logistic regression to analyze both recently listed and short-listed firms. In this analysis, the author compares the differences in investors' expectations for the first five years for both types of firms.

The author provides convincing evidence that markets clearly placed lower valuation weights on accounting earnings and R&D expenditures for short-listed firms on NASDAQ. Market participants originally had high expectations for these ventures. But, they gradually understood the lower quality of accounting information and adjusted their expectations downward.

The author’s results show that optimistic expectations along with easy equity financing created a surge of new listings. My analysis of the interplay between the quality of accounting information and investors' expectations indicates a negative spillover effect where investors are overoptimistic about firms that rode on waves of new listings backed by liberal financing. The author shows that analysis of Tobin's Q and negative earnings can separate ill-prepared from longer-listed firms.

This paper aims to analyze the association between goodwill defined as difference between market and book value of equity and reports of nonrecurring items, namely, special items, discontinued operations and extraordinary items to suggest information related to restructuring activities measured by these items can link the valuation and incentive roles of accounting. Economic intuition suggests that successful managerial efforts should increase firm value. Yet, the link between the valuation and stewardship roles of earnings has been difficult to verify.

The author first estimates whether nonrecurring items have an incremental ability to explain goodwill, measured as the difference between market and book value of equity, at the industry level and then estimates whether firm-specific accounting bias is associated with the industry-level signals sent by nonrecurring items. The author then analyzes whether these items are associated with the use of chief executive officer (CEO) market-based compensation.

The author’ results show that information contained in special items increases firm-specific goodwill, indicating that it sends signals to investors about future growth opportunities, while that of discontinued operations reduces goodwill, suggesting that it provides signals about the adjustments of book value. She does not find any significant informational role for extraordinary items. She also finds that the signals sent by special items are negatively associated with the use of CEO market-based compensation, while those relayed by discontinued operations are positively associated with the use of market-based pay.

Contrary to prior studies, the results show special items and discontinued operations are both value and incentive relevant. There are two caveats to this analysis. First, owing to the frequent changes in the definition of discontinued operations, the analysis is conducted using data between 1992 and 2003. Second, some might argue that industry-level incremental R² might not be appropriate for a compensation analysis. However, entities often use industry norms as a benchmark to set CEO compensation. Thus, it is reasonable to think that industry-level signals matter for executive pay.

The author’s findings suggest that compensation committees in firms across industries consider the information contained in special items and discontinued operations, and selectively alter the level of incentives to encourage managerial efforts.

Intergenerational programs and practices refer to a wide range of initiatives which aim to bring people of different generations together to interact, educate, support, and provide care for one another. Insofar as there is such rapid growth in intergenerational program activity taking place at the national and international levels, it is pertinent to wonder how we can cultivate innovative, effective leaders in a variety of professional roles and settings. This article explores various conceptions about how to prepare and inspire intergenerational professionals. Beyond focusing on the set of skills and knowledge that practitioners need to function effectively, we argue that there are certain personal dispositions that are integral to leadership in this field. To illustrate how passion, what the authors call the p-factor, contributes to exemplary intergenerational practice, several examples are provided of intergenerational professionals who emanate this quality. Implications for preparing future intergenerational leaders are considered.