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Media type:
E-Book
Title:
Easier Said Than Done
:
The Effect of ARUG II on Clawback Provision Adoption and the Diversity of Clawback Trigger Events in German DAX30 & MDAX Companies
Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments May 17, 2021 erstellt
Description:
In this study, we examine the annual reports of the German DAX30 and MDAX com-panies to analyze the level of clawback provision adoption in management compensation con-tracts due to the finalization of ARUG II in Germany. In addition, we investigate the diversi-ty of the trigger events named in the provisions already implemented. We find that although the number of companies that adopted clawback provisions slightly increased from 2018 to 2019, it is still relatively low, compared to the developments in the US several years ago. We find that in 2019 39 % of the companies had clawback provisions implemented in their com-pensation system. By analyzing the trigger events named in these provisions we show, that most of the clawback provisions are meant to prevent compliance violations or misconduct. Very few provisions cover errors in reporting or negative contribution to success. Based on these findings we present and discuss previous literature, which helps to explain the slow change and discuss the different effects of clawback trigger events. We further suggest ave-nues for future research and provide implications based on our findings