Journal article
CSR contracting and performance-induced CEO turnover
Bo Qin, Lu Yang
Journal of Corporate Finance | Elsevier | Published : 2022
Abstract
Motivated by the rise of linking CEO compensation to corporate social responsibility (hereafter, CSR contracting), we examine the impact of CSR contracting on CEO performance-induced turnover. Using a sample of S&P 500 firms with hand collected information on the use and substantiveness of CSR contracting from proxy statements between 2004 and 2018, we find that CSR contracting firms are associated with reduced turnover–performance sensitivity. Furthermore, CSR contracting's effects hold regardless of CEO power, although the impact appears to be concentrated in observations both during and after the global financial crisis, in firms with superior CSR ratings, and in those managed by more abl..
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Awarded by Monash University
Funding Acknowledgements
We sincerely thank Bart Lambrecht (Editor) and two anonymous referees for their constructive comments. We appreciate the helpful comments of Mary Barth, Christof Beuselinck, Jan Bouwens, Alexander Bruggen, Eddy Cardinaels, Wai Fong Chua, Francesca Cornelli, Bart Dierynck, Shane Dikolli, Fei Du (discussant), Christoph Feichter, Isabella Grabner, Katlijn Haesebrouck, Stephan Hollander, Reggy Hooghiemstra, Sterling Huang, Dirk Jenter, Flora Kuang, David Larcker, Rachael Lewis (discussant), Zhengyu Li, Hao Liang, Pierre Liang, Louise Lu, Frank Moers, Don Moser, Julia Mundy, Vic Naiker, Gaizka Ormazabal, Paige Patrick, Marlene Plumlee, Joseph Piotroski, Annelies Renders, Katherine Schipper, Naomi Soderstrom, Oscar Timmermans, Laurence van Lent, Paula van VeenDirks, Huaxiang Yin, Yachang Zeng, Luo Zuo, and the seminar participants at Tilburg University, Maastricht University, Erasmus School of Economics, University of Groningen, and Monash University. We thank participants at 2018 AFAANZ Conference (Auckland), 11th EIASM Conference on New Directions in Management Accounting (Brussels), and 2019 AAA Management Accounting Section Midyear Meeting (Fort Lauderdale). We also thank Yanru Fu, Stella Lim, Qianqian Wang, and Zhangqi Xu for their research assistance. This work was supported by the National Natural Science Foundation of China [grant number No. 71702094] All remaining errors are our own.