Does CEO debt-like compensation mitigate corporate social irresponsibility?

Chen, L.; He, G.; Krishnan, G.

Abstract

Corporate social irresponsibility (CSI) is an increasingly relevant topic to today’s business, as CSI may exert stronger impacts on firms than corporate social responsibility (CSR). However, little is known about mechanisms that can constrain such irresponsible actions. We examine whether CEO debt-like compensation (i.e., pension and deferred compensation granted to the CEO of a firm) mitigates CSI, which is proxied by environmental, social, and governance (ESG) risk exposure. Using media coverage of ESG incidents as a measure, we find that ESG risk exposure is negatively related to CEO debt-like compensation. Furthermore, this relation is stronger when firms have higher distress risks or when CEOs have greater career concerns.

Citation

Chen, L., He, G., & Krishnan, G. (2024). Does CEO debt-like compensation mitigate corporate social irresponsibility?. Accounting Forum, 48(4), 594-634. https://doi.org/10.1080/01559982.2023.2195983

• Journal Article Type: Article
• Acceptance Date: Mar 14, 2023
• Online Publication Date: Apr 27, 2023
• Publication Date: 2024
• Deposit Date: Mar 15, 2023
• Publicly Available Date: Apr 28, 2023
• Journal: Accounting Forum
• Print ISSN: 0155-9982
• Electronic ISSN: 1467-6303
• Publisher: Taylor and Francis Group
• Peer Reviewed: Peer Reviewed
• Volume: 48
• Issue: 4
• Pages: 594-634
• DOI: https://doi.org/10.1080/01559982.2023.2195983
• Public URL: https://durham-repository.worktribe.com/output/1178232