Stock-based compensation plan: an analysis of the determinants of its use

ABSTRACT This study’s aim was to investigate the main aspects that determined the use of the stock-based compensation model and the variables that influence the amount paid. The article fills the gap in the previous debate regarding the variables that affect the decision to offer stock-based remuneration, as well as revealing the factors that impact its magnitude and providing a more robust statistical treatment with regards to endogeny. Brazil is known to be a country where the agency conflict between controlling and minority shareholders predominates, and so it is important to understand the determinants of adoption and of the amount paid to managers using stock options, since remuneration can be used as a form of tunneling. This study identified a possible trade-off between cash and stock compensation, in view of increased company indebtedness. It also found that in the Brazilian market this type of remuneration is not related to governance and performance. A panel data regression was used with fixed effects in the firm and industry*year to eliminate the possible bias arising from constant heterogeneities in time for the firms and shocks in the industries in a particular year. In addition, to identify the determinants, we used a logistic regression with panel data and fixed effect in industry*year. The study sample comprised 287 companies listed on the Bolsa, Brasil, Balcão (B3) exchange. This research shows that 40% of the companies in the period from 2010 to 2016 adopted stock-based compensation plans; however, the amount paid is still low, at 0.03% of total company assets. The results indicate that in the Brazilian market variables such as investment opportunities and company size increase the likelihood of adopting the employee stock options plan (ESOP). In addition, regarding the amount paid, this is negatively related to company leverage, indicating that in possible liquidity shocks the companies opt to compensate managers with shares to reduce their exposure to systematic risks.摘要 本研究旨在探究决定基于股票的薪酬（stock-based compensation）模式使用的核心维度，以及影响支付额度的相关变量。本文弥补了此前关于股权激励薪酬决策影响变量的研究空白，同时揭示了影响其规模的核心因素，并针对内生性问题采用了更为稳健的统计处理方法。 巴西以控股股东与中小股东之间的代理冲突为主要公司治理特征，因此厘清采用股权激励的决定因素以及以股票期权形式向管理层支付薪酬的额度至关重要，因为此类薪酬可能被用作隧道挖掘的手段。 本研究发现，随着企业负债水平上升，现金薪酬与股权激励之间可能存在权衡关系。同时研究还发现，在巴西市场中，此类薪酬与公司治理水平及经营绩效并无显著关联。 本研究采用了企业层面与行业×年度固定效应的面板数据回归模型，以消除企业层面随时间恒定的异质性以及特定年度行业冲击所引发的潜在估计偏误。此外，为识别股权激励采用的决定因素，本文采用了带行业×年度固定效应的面板数据逻辑回归模型。 本研究的样本涵盖了巴西B3证券交易所（Bolsa, Brasil, Balcão, B3）上市的287家公司。研究显示，2010年至2016年期间，40%的样本公司采用了股权激励计划；但整体支付额度仍较低，仅占企业总资产的0.03%。 研究结果表明，在巴西市场中，投资机会与企业规模等变量会提升企业实施员工股票期权计划（Employee Stock Option Plan, ESOP）的概率。此外，就支付额度而言，其与企业杠杆率呈负相关关系，这意味着当面临流动性冲击时，企业会选择以股权形式补偿管理层，以降低自身面临的系统性风险敞口。