경영자 보상 형태와 원가 비대칭성

This study investigates the effect of CEO compensation type on asymmetric cost behavior. Accounting earnings help shield managers’ compensation from market-wide variations in equity values. When managers’ compensation is based on accounting earnings, managerial decisions are likely to be sensitive to short term earnings (Lambert & Larcker 1987; Dechow & Sloan 1991; Sloan 1993; Jensen & Murphy 1990; Baber et al. 1996). However, managers with stock option possibly take into account various factors other than earnings and would tend to have a long-term perspective (Brickley et al. 1985; Core and Guay 1999; Hanlon et al. 2003; Ittner 2003). Considering these contrasting aspects, we hypothesize that managerial decision on slack resources is differently affected by the compensation plan depending on whether it is accounting earnings-based (ACP) or stock option-based (MKP). To test our hypothesis, we focus on asymmetric cost behavior which is assumed to be the results of managers’ decision. Related to our study, Lee and Nam (2010) insist that pay-performance relationship affect managers’ decision-making. The authors find the firms with pay-performance relationship show less stickiness than those without it. The result implies that the degree of stickiness is affected by control systems like performance evaluation and compensation which are intended to influence managers’ decision behavior. Our sample comprises the data of Korean listed companies (KOSPI) from 2001 to 2011, which yields the pooled samples of 5,037 firm-year observations. To test cost behavior, we employ regression model of Anderson et al.(2003). We measure earnings-based compensation system by using pay-performance relationship. We use four type of cost - ‘Selling, General, and Administrative expense’, ‘General Administrative expense’, ‘Cost of Goods Sold’ and ‘Wage expense’. The empirical findings are as follows. First, when sales decrease, managers with earnings-based compensation are more likely to reduce resources faster than those without one, so alleviating the degree of asymmetric cost behavior. In addition, managers with stock option compensation have the same tendency as with those with earnings-based compensation. However, managers with earnings-based compensation plan show less asymmetric cost behavior than those with stock option-based. Those results are almost robust when we use ‘General Administration cost’, ‘Cost of Goods Sold’ and ‘Wage’ in test model. Above results suggest that managers with earnings-based compensation more quickly and sensitively adjust the slack resources when sales decrease, as managers. This evidence is consistent with our hypothesis that earnings-based and stock option-based compensation plans can differently affect managerial decisions, more specifically the decision on the disposal of slack resources in the period of decreasing sales. In addition, we also compare managers with stock option-based and owner-managers. We hypothesize that owner-manager reduces committed resources when sales decline in less proportion than when increasing committed resources during sales increase, but firms with employed manager seem to reduce their resources more quickly than in owner-manager firms. The result illustrates that owner-managers with no stock option show most asymmetric cost behavior among managers.