We examine the effects of performance measure properties on incentive system design, using data on incentive contracts … design. First, firms appear to choose the "best" performance measure available along these dimensions, and use it for the … most important (primary) formula bonus. Second, the properties of this primary performance measure are important …

the announcement of a clawback adoption, as well as post-adoption stock and accounting performance, are significantly and …

moderated when firm-level uncertainty is high, consistent with performance being attributed more to luck rather than skill and …

If overstatements were a symptom of the agency conflict, pay-for-performance sensitivities should have increased in …, we show that (i) CEO pay-for-performance sensitivities are higher among firms whose shareholders stand to benefit from … overstatements; (ii) this cross-sectional relationship weakens significantly after SOX; and (iii) the within-firm decrease in pay-for-performance …

-sectional association between the stock price performance of a firm and change in the equivalent shares awarded to the CEO. That is exactly … performance as poor (superior) stock price performance is rewarded with larger (smaller) share grants. Directors’ equity … performance due to competitive pay policy …

performance of a firm and change in the equivalent shares awarded to the CEO. That is exactly what we document in our sample of 21 …, that such a practice penalizes the sensitivity of CEO wealth to stock price performance as poor (superior) stock price … performance is rewarded (penalized) with larger (smaller) equity grants. Directors’ equity compensation also strongly reflects the …

performance outcomes. We propose and test the hypothesis that clawback provisions motivate managers to reduce firm risk. Panel OLS …