The role of power and politics in the repricing of executive options

Wade, J.B.; Pollock, T.; Fischer, H.M.; Harald, M.

doi:10.2307/3069432

The role of power and politics in the repricing of executive options

Wade, J.B.; Pollock, T.; Fischer, H.M.; Harald, M.

Authors

J.B. Wade

T. Pollock

H.M. Fischer

M. Harald

Abstract

We explore how CEO power affects the repricing of executive options. The spread between an option's exercise, or strike, price, and the market value of a stock impacts the likelihood of repricing. This effect is enhanced when the CEO of the firm in question is also the chairman of its board. Firm and CEO visibility, more board members appointed after a CEO's hiring than before it, a staggered board, and relatively high percentages of CEO and institutional ownership reduce the impact of the spread on the likelihood of repricing.

Citation

Wade, J., Pollock, T., Fischer, H., & Harald, M. (2002). The role of power and politics in the repricing of executive options. Academy of Management Journal, 45(6), 1172-1182. https://doi.org/10.2307/3069432

Journal Article Type	Article
Publication Date	Dec 1, 2002
Deposit Date	Aug 27, 2008
Publicly Available Date	Nov 30, 2017
Journal	Academy of Management Journal
Print ISSN	0001-4273
Publisher	Academy of Management
Peer Reviewed	Peer Reviewed
Volume	45
Issue	6
Pages	1172-1182
DOI	https://doi.org/10.2307/3069432
Public URL	https://durham-repository.worktribe.com/output/1563301