An examination of the benefits for privately‐held and mutual insurers’ CEOs following an IPO

Managerial Finance - Tập 28 Số 12 - Trang 63-81 - 2002
KulkanyaNapompech1, MarkKroll2, RogerShelor3
1College of Administration and Business, PO Box 10318 Louisiana Tech University, Ruston, LA 71272
2Department Head of Management and Marketing, Maurice Tatum Professor of Business, College of Administration and Business, CAB Room No. 120, PO Box 10318, Louisiana Tech University, Ruston, LA 71272
3Finance Department, College of Business, 222 Copeland Hall, Ohio University, Athens, Ohio 45701‐2979

Tóm tắt

This study examines compensation changes among top executives of formerly privately held stock insurers and mutual insurers at the time around an initial public offering. This study explains how CEO compensation changes following an IPO differ between these two types of insurers owing to their differing agency characteristics. The results also show that CEOs’ benefits increase materially following an IPO. The authors find evidence that reduced ownership retention by managers increases agency costs and CEOs of mutual insurers exploit their positions and increase their reward at the expense of policyholders.

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Managerial Finance

Tập 28 Số 12

63-81

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