Impact of pay disparities between chief executive officers and chief financial officers on corporate financial and investment policies

Abstract There has been an increasing trend for Congress and the Centers for Medicare and Medicaid Services (CMS) to add non-skilled services to coverage under Medicare Advantage and Medicaid inpatient hospital. At the same time there has been a 75% decline in home health aide visits, the only Medicare home health non-skilled service, as a percentage of all Medicare home health visits from 2000-2016. A literature review indicates no studies addressing the potential factors accounting from these seemingly contradictory trends. The present study is based on interviews of five Chief Executive Officers (CEOs), five Chief Financial Officers (CFOs), and eight Chief Nursing Officers (CNOs) from Medicare-certified home health agencies between October 2017-July 2018. Results indicated agreement among interviewees on three themes: the Medicare home health relies on a medical model which focuses on intermittent skilled care; the Medicare home health prospective payment system (PPS) exacerbated the focus on skilled care by rewarding higher reimbursement for skilled care based episodes; and a synergy has evolved of “less is better” regarding utilization of home health aide services and reimbursement. Policymakers are urged to consider adding coverage of non-skilled services under Medicare home health, similar to Medicare Advantage, by funding demonstration projects with appropriate changes in reimbursement.

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Executive Network Centrality and Corporate Reporting

Management Science ◽

10.1287/mnsc.2020.3924 ◽

2021 ◽

Author(s):

Jing He

Keyword(s):

Chief Executive Officers ◽

Fixed Effects ◽

Social Power ◽

Chief Executive ◽

Chief Financial Officers ◽

Network Centrality ◽

Corporate Reporting ◽

Internal Governance Mechanisms ◽

Financial Misreporting ◽

Executive Officers

This paper investigates the association of corporate reporting and executive network centrality, which measures an executive’s relative position in a massive network consisting of outside corporate leaders. I find that high-centrality chief executive officers (CEOs) and chief financial officers (CFOs) are generally more likely to engage in financial misreporting than low-centrality CEOs and CFOs. I also find that the influence of CFO network centrality is greater than that of CEOs in financial misreporting. Further analyses show that the monitoring effect of internal governance mechanisms on high-centrality executives is very limited and that the discipline of the managerial labor market is weaker for high-centrality CFOs as well. My results hold for a subsample subject to exogenous shocks to CFO connectedness and are robust to a series of alternative specifications including using CFO fixed effects. Taken together, my findings suggest that corporate reporting can be influenced by executives’ social network position, with high-centrality CFOs using their social power to make adverse corporate reporting decisions to gain personal benefits. This paper was accepted by Brian Bushee, accounting.

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Top executive compensation in less developed capital markets

Corporate Governance ◽

10.1108/cg-11-2014-0128 ◽

2015 ◽

Vol 15 (1) ◽

pp. 122-133 ◽

Cited By ~ 3

Author(s):

Ivo Nuno Pereira ◽

José Paulo Esperança

Keyword(s):

Executive Compensation ◽

Capital Markets ◽

Chief Executive Officers ◽

Chief Executive ◽

Chief Financial Officers ◽

Tobit Regression ◽

Content Type ◽

Variable Pay ◽

Tobit Regression Analysis ◽

Executive Officers

Purpose – This paper aims to study the determinants of variable compensation for top Portuguese executives (chief executive officers, chief financial officers and commercial directors). Design/methodology/approach – Data from 101 firms were collected through an email questionnaire sent to the human resource directors of 500 largest and best Portuguese firms of Exame, a business newspaper. A Tobit regression analysis was used to estimate the basic equation of the study. Findings – The conclusions are generally consistent with findings obtained in more developed capital markets. It was found that public and older corporations are more intensive users of variable pay, consistent with the agency theory prediction. A location in the centre of economic activity and a higher executive education increase the propensity to receive higher levels of salary in the form of variable compensation. The relation between compensation and performance was more elusive. Research limitations/implications – There are limitations as to the extrapolation of the obtained results, as the level of potential idiosyncrasy cannot be measured. Ideally, the study should be replicated in different contexts to control for country-specific influences. Nevertheless, the main finding that performance-related pay mechanisms are less used in countries where public corporations and potential agency problems are less pervasive should hold. Originality/value – As the focus is on a small economy with a developing capital market, this paper contributes to executive compensation literature that has mostly analysed firms based in well-developed capital markets, with a higher separation of ownership and control (Anglo-Saxon countries).

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SEC enforcement actions getting up close and personal

Journal of Investment Compliance ◽

10.1108/joic-02-2016-0008 ◽

2016 ◽

Vol 17 (1) ◽

pp. 131-132

Author(s):

Matthew E. Kaplan ◽

Alan H. Paley ◽

Jonathan R. Tuttle

Keyword(s):

Financial Reporting ◽

Chief Executive Officers ◽

Audit Committee ◽

Chief Executive ◽

Chief Financial Officers ◽

Securities Fraud ◽

Content Type ◽

Securities Law ◽

Public Company ◽

Executive Officers

Purpose To alert public company management and directors to several recent SEC enforcement actions involving executives and other senior personnel arising out of securities law violations. Design/methodology/approach Reviews a series of enforcement actions against four chief executive officers, four chief financial officers, an audit committee chair, and one outside auditor (BDO USA LLC) and five of its partners arising out of securities law violations by four different corporations (MusclePharm Corporation, Bankrate, Inc., KIT Digital, Inc. and General Employment Enterprises, Inc.). Each of the actions involved financial reporting and disclosure violations. Also highlights the need for directors and senior management to maintain a sharp focus on their company’s controls and disclosure practices. Findings The SEC’S actions may portend renewed determination by the agency to hold executives and directors, as well as outside professionals, accountable for securities fraud and disclosure violations committed by corporations. Originality/value Practical guidance from experienced securities lawyers.

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Female executives and corporate governance

Managerial Finance ◽

10.1108/mf-04-2016-0098 ◽

2017 ◽

Vol 43 (10) ◽

pp. 1056-1072 ◽

Cited By ~ 5

Author(s):

Emilia Vähämaa

Keyword(s):

Corporate Governance ◽

Chief Executive Officers ◽

Chief Executive ◽

Chief Financial Officers ◽

Gender Quotas ◽

Content Type ◽

Takeover Defenses ◽

Governance Practices ◽

The Board Of Directors ◽

Executive Officers

Purpose The purpose of this paper is to examine whether the gender of the top executives is associated with the strength of corporate governance mechanisms within a firm. Design/methodology/approach The paper uses panel and instrumental variable regressions on an eight-year sample of the S&P 1,500 firms. Findings The results indicate that firms with female Chief Executive Officers (CEOs) and Chief Financial Officers have higher quality governance practices. Moreover, female CEOs are documented to have the most significant influence on the governance attributes related to the board of directors and takeover defenses mechanisms. Originality/value Overall, these findings indicate that the gender of the firm’s executives may have important implications for the strength of corporate governance. The paper promotes the importance of the recent national policies in numerous countries on gender quotas at the executive level.

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Integrating Practice into Accounting Research

Management Science ◽

10.1287/mnsc.2020.3590 ◽

2020 ◽

Cited By ~ 2

Author(s):

Shiva Rajgopal

Keyword(s):

Chief Executive Officers ◽

Academic Research ◽

Chief Executive ◽

Management Science ◽

Chief Financial Officers ◽

Policy Makers ◽

Accounting Research ◽

65Th Anniversary ◽

Set Up ◽

Executive Officers

I argue that academic research in accounting has strayed from producing work that is useful to either practitioners or policy makers. I use three criteria to arrive at that assessment: (i) How many products and processes have accounting research produced in the last 50 years? (ii) How much overlap do we observe between issues that Chief Financial Officers (CFOs) and Chief Executive Officers (CEOs) worry about and our published research? (iii) Is the science or the knowhow in academe in a particular area ahead of that in practice? I conjecture that tuition-funded research drives this problem. I review several initiatives that have been tried at Columbia and elsewhere (i) to better integrate academic research and practice and (ii) to disseminate our findings to practitioners. I suggest that Management Science set up a forum to encourage submissions of papers that use rigorous methods to address pressing applied problems. This paper was accepted by David Simchi-Levi, Special Issue of Management Science: 65th Anniversary.

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Are CFOs’ Trades More Informative Than CEOs’ Trades?

Journal of Financial and Quantitative Analysis ◽

10.1017/s0022109012000257 ◽

2012 ◽

Vol 47 (4) ◽

pp. 743-762 ◽

Cited By ~ 40

Author(s):

Weimin Wang ◽

Yong-Chul Shin ◽

Bill B. Francis

Keyword(s):

Risk Factors ◽

Stock Returns ◽

Chief Executive Officers ◽

Abnormal Returns ◽

Chief Executive ◽

Superior Performance ◽

Chief Financial Officers ◽

Future Earnings ◽

Earnings Surprises ◽

Executive Officers

AbstractWe investigate whether trades made by chief financial officers (CFOs) reveal more information about future stock returns than those by chief executive officers (CEOs). We find that CFOs earn statistically and economically higher abnormal returns following their purchases of company shares than CEOs. During 1992–2002, CFOs earned an average 12-month excess return that is 5% higher than that by CEOs. The superior performance by CFOs occurs notwithstanding controls for risk factors and persists even after their trades are publicly disclosed. Further analysis shows that CFO purchases are associated with more positive future earnings surprises than CEO purchases, suggesting that CFOs incorporate better information about future earnings.

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Tournaments and Stock Options for Chief Executive Officers

SSRN Electronic Journal ◽

10.2139/ssrn.676211 ◽

2005 ◽

Author(s):

Francisco Covas ◽

Alexandra Lai

Keyword(s):

Chief Executive Officers ◽

Stock Options ◽

Chief Executive ◽

Executive Officers

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Effect of leadership styles on organizational commitment and performance in small- and medium-sized enterprises in Iraqi Kurdistan

Social Behavior and Personality An International Journal ◽

10.2224/sbp.9197 ◽

2020 ◽

Vol 48 (9) ◽

pp. 1-12

Author(s):

Karwan Hamasalih Qadir ◽

Mehmet Yeşiltaş

Keyword(s):

Organizational Commitment ◽

Organizational Performance ◽

Leadership Styles ◽

Chief Executive Officers ◽

Chief Executive ◽

Mediating Effect ◽

Positive Effects ◽

Iraqi Kurdistan ◽

And Performance ◽

Executive Officers

Since 2003 the number of small- and medium-sized enterprises (SMEs) has increased exponentially in Iraqi Kurdistan. To facilitate further growth the owners and chief executive officers of these enterprises have sought to improve their leadership skills. This study examined the effect of transactional and transformational leadership styles on organizational commitment and performance in Iraqi Kurdistan SMEs, and the mediating effect of organizational commitment in these relationships. We distributed 530 questionnaires and collected 400 valid responses (75% response rate) from 115 SME owners/chief executive officers and 285 employees. The results demonstrate there were positive effects of both types of leadership style on organizational performance. Further, the significant mediating effect of organizational commitment in both relationships shows the importance of this variable for leader effectiveness among entrepreneurs in Iraqi Kurdistan, and foreign entrepreneurs engaging in new businesses in the region.

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Toward a Working Model of Leadership in Nonprofit Sport Governance

Journal of Sport Management ◽

10.1123/jsm.2018-0227 ◽

2019 ◽

Vol 33 (3) ◽

pp. 189-202 ◽

Cited By ~ 2

Author(s):

Ian O’Boyle ◽

David Shilbury ◽

Lesley Ferkins

Keyword(s):

Chief Executive Officers ◽

Leadership Skills ◽

Chief Executive ◽

Future Research ◽

Limited Attention ◽

Study Approach ◽

Working Model ◽

Executive Officers ◽

Scholarly Discourse

The aim of this study is to explore leadership within nonprofit sport governance. As an outcome, the authors present a preliminary working model of leadership in nonprofit sport governance based on existing literature and our new empirical evidence. Leadership in nonprofit sport governance has received limited attention to date in scholarly discourse. The authors adopt a case study approach involving three organizations and 16 participant interviews from board members and Chief Executive Officers within the golf network in Australia to uncover key leadership issues in this domain. Interviews were analyzed using an interpretive process, and a thematic structure relating to leadership in the nonprofit sport governance context was developed. Leadership ambiguity, distribution of leadership, leadership skills and development, and leadership and volunteerism emerged as the key themes in the research. These themes, combined with existing literature, are integrated into a preliminary working model of leadership in nonprofit sport governance that helps to shape the issues and challenges embedded within this emerging area of inquiry. The authors offer a number of suggestions for future research to refine, test, critique, and elaborate on our proposed working model.

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