The impact of golden parachutes on Fortune 500 stock returns: a reexamination of the evidence.

From: Quarterly Journal of Business and Economics | Date: September 22, 1995| Author: Mogavero, Damian J.; Toyne, Michael F. | Copyright information

INTRODUCTION

Golden parachutes provide executives with a form of compensation insurance in the event they are terminated following a change of corporate control. While golden parachutes alone have only a minor economic impact on potential takeovers, they represent (and often are accompanied by) a class of takeover defense mechanisms that potentially undermine the fundamental responsibility of executives and boards to represent the best interests of stockholders. During the m...

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