This paper examines the relationship between CEO incentives and strong and weak corporate social performance. Using the KLD database we find that incentives have no significant relationship with strong social performance. Salary and long-term incentives have a positive association with weak social performance.

Using the behavioral agency model, we analyze how two compensation design characteristics, pay-performance sensitivity and duration of CEO compensation, affect corporate social performance. We find that the performance sensitivity of CEO pay is negatively associated with poor social performance but also negatively affects strong social performance. These results suggest that pay-performance sensitivity increases the relevance of potential negative consequences of poor social performance. However, the ‘insurance’ benefits of strong social performance may also become less relevant. With respect to the duration (...) of CEO compensation, we find that it reduces poor social performance. This finding confirms arguments that a long-term compensation time horizon increases the perceived threat that the negative effects of poor social performance will become visible. With our findings, we integrate behavioral agency theory with the traditional stakeholder views. (shrink)

All farmers have their own version of what it means to be a good farmer. For many US farmers a large portion of their identity is defined by the high input, high output production systems they manage to produce food, fiber or fuel. However, the unintended consequences of highly productivist systems are often increased soil erosion and the pollution of ground and surface water. A large number of farmers have conservationist identities within their good farmer identity, however their conservation goals (...) often need to be activated to rebalance the production-conservation meanings they give to their roles in society. In this paper we analyze US Cornbelt farmer interviews and surveys to trace how the performance-based environmental management process can be used to influence the farmer social identity and shift the overall good farmer identity towards a stronger conservationist standard. We find the continuous feedback loop in performance-based environmental management mimics the hierarchically organized feedback control processes of identity verification and can be used to help farmers activate their conservationist farmer identities at the person, role, and social levels to establish new norms for the practice of more sustainable agriculture. (shrink)