Perils of Limiting the Coverage of Mandatory Pay Disclosure: The Korean Experience

摘要: This study documents the danger of limiting coverage mandatory pay disclosure. Exploiting 2013 rule change in Korea, we find that its restrictive coverage, confined to board members with total annual exceeding 500 million Korean won, led a large fraction executives evade disclosure through deregistration (i.e., stepping down from board) or pay-cuts. We also such evasion is mostly carried out by family firms high executive-to-worker ratios. If original level close threshold, choose pay-cuts over deregistration, as their preferred means evasion.