Changes in CEO Stock Option Grants: A Look at the Numbers

Changes in CEO Stock Option Grants: A Look at the Numbers

Vasiliki Athanasakou, Daniel Ferreira, Lisa Goh

Series number :

Serial Number: 

Date posted :

June 01 2013

Last revised :

March 15 2023
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  • Corporate investment • 
  • stock options grants • 
  • Earnings management • 
  • CEO overconfidence

We study changes in the number of CEO stock option grants. Despite some evidence of short-term rigidity, the number of options granted changes frequently over time. CEOs of firms with unusual investment patterns subsequently receive fewer stock options as part of their compensation packages.

CEOs who hold exercisable deeply-in-the-money options (overconfident CEOs) also receive fewer stock options in subsequent periods. Our results show that past CEO behavior predicts stock option grants. These insights can inform theoretical discussion on option-granting behavior and, more broadly, on the board’s re-contracting process.

Published in

Published in: 
Journal of Corporate Finance 75, August 2022, 102226


Real name:
Vasiliki Athanasakou
Real name:
Lisa Goh