Abstract
We explore the relationship between managerial incentives and environmental harm. We find that high-powered executive compensation packages can increase the odds of environmental law-breaking by 40-60% and the magnitude of environmental harm by over 100%. We document similar results for the setting of executive compensation and financial accounting misconduct. Finally, we outline some managerial and policy implications to blunt these adverse incentive effects.
| Original language | English (US) |
|---|---|
| Publisher | Social Science Research Network (SSRN) |
| Number of pages | 49 |
| State | Published - Apr 12 2016 |