Directors’ and officers’ liability insurance coverage

Equity-based compensation, Directors’ and officers’ liability insurance coverage, Earnings management This study investigates how managers’ compensation incentives, as measured by equity-based executive compensation and managerial legal liability coverage affect earnings management. The availability of compensation may encourage managers to adopt more aggressive accounting practices; however, the higher the legal liability managers face, the more it will reduce their willingness to engage in such risk-taking behavior.

27p cothumenhmong4 24-03-2020 17 2   Download

Equity holdings of family firms represent an important form of company ownership in South-East Asia. In order to enhance the effectiveness of corporate governance, listed companies have been required to disclose more information on their director and officer insurance (hereafter D&O insurance) purchases in Taiwan. This publicly available data enables this study to investigate how family firms react to litigation risks in terms of their D&O insurance. Using the D&O insurance coverage of Taiwan firms as a proxy for management legal liability coverage, this study made two major findings.

27p trinhthamhodang2 19-01-2020 44 3   Download