Does stock options plan really matter on the Malaysian firm performance?
Keywords:Stock Option plan, Firm performance
This paper examines the effect of stock options plan on firm performance. By using a multivariate regression analysis on 58 Malaysian listed firms with stock option plan, the main finding shows that granting stock option plans do not entirely lead to improvements over firm performance in Malaysia. From this result may spur a debate about the role stock option plans play in enhancing firm performance as in the few years that stock options have been in use in Malaysia, stock option plans gained popularity. But at the same time manipulation in accounting measures such as creative accounting and earnings management, has led the public to question the practicality in adopting stock option plans at least for reducing agency problems.
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