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- Title
Integrity, unprincipled agents and corporate governance reform.
- Authors
Arce, Daniel
- Abstract
This study investigates the implications of integrity-interpreted as the alignment of one's words and deeds-within the agency paradigm by explicitly allowing for unprincipled behavior (agent misconduct) in addition to conflicts of interest resulting from the separation of ownership and control. Under adverse selection, contracts that screen for agents who exhibit integrity characterize a previously unidentified symbiosis between the penalty for unprincipled behavior and high-powered incentive pay. The resulting contracts and penalties are interpreted in light of the Sarbanes-Oxley and Dodd-Frank Acts.
- Subjects
CORPORATE governance; AGENCY (Law); CONFLICT of interests; CORPORATE reform; UNITED States. Sarbanes-Oxley Act of 2002; DODD-Frank Wall Street Reform &; Consumer Protection Act
- Publication
European Journal of Law & Economics, 2015, Vol 39, Issue 3, p539
- ISSN
0929-1261
- Publication type
Article
- DOI
10.1007/s10657-014-9478-4