Conference Agenda

Overview and details of the sessions of this conference. Please select a date or location to show only sessions at that day or location. Please select a single session for detailed view (with abstracts and downloads if available).

 
 
Session Overview
Session
Track T3-4: Corporate Theory
Time:
Tuesday, 21/May/2024:
11:30am - 12:15pm

Session Chair: Giorgia Piacentino, USC
Discussant: Marcus Opp, Stockholm School of Economics
Location: Room 548


Presentations

Executive Compensation with Social and Environmental Performance

Pierre Chaigneau1, Nicolas Sahuguet2

1Queen's University; 2HEC Montreal

How to incentivize a manager to create value and be socially responsible? A manager can predict how his decisions will affect measures of social performance, and will therefore game an incentive system that relies on these measures. Still, we show that the compensation contract uses measures of social performance when the level of corporate social responsibility preferred by the board exceeds the one that maximizes the stock price. Relying on multiple measures based on different methodologies will generally mitigate inefficiencies due to gaming, i.e. harmonization of social performance measurement can backfire. This has normative implications for the regulation and harmonization of ESG measurement.


Chaigneau-Executive Compensation with Social and Environmental Performance-456.pdf