Corpus ID: 27549660

CEO Overconfidence , Corporate Governance , and the Demand for Directors and Officers Insurance ∗

@inproceedings{Bolesa2014CEOO,
  title={CEO Overconfidence , Corporate Governance , and the Demand for Directors and Officers Insurance ∗},
  author={Jeffrey Bolesa and Yevgeniy Davydovb and Jacqueline Volkman-Wisec},
  year={2014}
}
  • Jeffrey Bolesa, Yevgeniy Davydovb, Jacqueline Volkman-Wisec
  • Published 2014
  • Previous work shows directors’ and officers’ (D&O) liability coverage provides insight into a firm’s risk-taking and governance. We develop a theoretical model to show how CEO overconfidence impacts D&O insurance decisions. We find firms with overconfident CEOs have a lower demand for D&O insurance. Using an options-based measure for CEO overconfidence, we test this model and find that firms with overconfident CEOs have a lower demand for D&O insurance. This effect holds when controlling for… CONTINUE READING

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