Leveraging foreign institutional logic in the adoption of stock option pay among Japanese firms

Research summary : We investigate why J apanese firms have adopted executive stock option pay, which was developed with shareholder‐oriented institutional logic that was inconsistent with J apanese stakeholder‐oriented institutional logic. We argue that J apanese managers have self‐serving incentives to leverage stock ownership of foreign investors and their associated institutional logic to legitimize the adoption of stock option pay. Our...