Albuquerque, Ana, Mary Ellen Carter, Michael Guo, & Luann Lynch (2024). Complexity in compensation contracts

“This paper examines complexity in CEO compensation contracts. We develop a measure of compensation complexity and provide empirical evidence that complexity has increased substantially over time. We document that complexity results not only from factors reflecting efficient contracting, but also from external pressures from compensation consultants, institutional investors, proxy advisors, and attempts to benchmark to peers, with these external factors having greater impact in more recent years. Examining consequences of contract complexity, we find an association with lower future firm performance that is related to the influence of external factors on compensation design.” (Journal of Accounting and Economics). Read the publication, Complexity in compensation contracts in the Journal of Accounting and Economics, here.

This publication was written by Ana Albuquerque, Mary Ellen Carter, Michael Guo, & Luann Lynch.