Erratum Erratum to “How do firms adjust director compensation?” [Journal of Corporate Finance14 (2008) 153–162] Kathleen A. Farrell a, ⁎, Geoffrey C. Friesen a,1 , Philip L. Hersch b,2 a Department of Finance, University of Nebraska-Lincoln, Lincoln, NE 68588-0490, United States b Department of Economics, Barton School of Business, Wichita State University, Wichita, KS 67260-0078, United States The Publisher regrets that in the above article Tables 3 and 4 were omitted. Please find Table 3 below and Table 4 overleaf. There were also typographical errors in the paragraph following Eq. (1) on page 159 in section 3.2. Adjustments to total compensation. Eq. (1) and corrected paragraph is now reproduced overleaf. Journal of Corporate Finance 14 (2008) 753–754 DOI of original article: 10.1016/j.jcorpfin.2008.02.004. ⁎ Corresponding author. Tel.: +1 402 472 3005; fax: +1 402 472 5140. E-mail addresses: kfarrell2@unl.edu (K.A. Farrell), gfriesen2@unl.edu (G.C. Friesen), philip.hersch@wichita.edu (P.L. Hersch). 1 Tel.: +1 402 472 2330; fax: +1 402 472 5140. 2 Tel.: +1 316 978 7096; fax: +1 316 978 3308. Table 3 Target level of director compensation, 1998–2004 dependent variable is log of director total compensation 1998 1999 2000 2001 2002 2003 2004 Intercept 2.42 a 2.28 a 1.66 a 2.52 a 2.66 a 3.27 a 3.21 a (7.06) (5.88) (5.74) (7.63) (8.39) (16.8) (16.5) Log of sales 0.182 a 0.212 a 0.248 a 0.184 a 0.188 a 0.135 a 0.154 a (4.44) (5.42) (7.56) (5.59) (6.30) (6.55) (7.14) Market to book 0.138 a 0.0986 a 0.147 a 0.243 a 0.171 a 0.155 a 0.140 a (6.59) (3.73) (8.07) (8.15) (3.96) (4.84) (4.02) ROA - 0.0121 b 0.00284 0.0049 - 0.0116 b 0.00082 - 0.0040 - 0.00119 (2.10) (0.330) (1.63) (2.47) (0.147) (0.719) (0.208) Leverage 0.481 c 0.193 0.0112 - 0.136 - 0.222 0.170 - 0.0735 (1.70) (0.655) (0.039) (0.687) (1.18) (0.902) (0.365) Industry controls Yes Yes Yes Yes Yes Yes Yes Number of observations 236 237 237 237 236 227 225 Adjusted R 2 0.270 0.271 0.474 0.436 0.378 0.317 0.254 Model p-value 0.000 0.000 0.000 0.000 0.000 0.000 0.000 Based on a sample of 237 firms. Total Compensation is in thousands of dollars. T-statistics in parentheses are based on robust (White estimator) standard errors. Total compensation is the sum of the cash retainer plus standardized meeting fees plus total equity compensation including the dollar value of all stock and options awarded. For the one observation where Total compensation was zero, we imputed a value of 1 (i.e., $1000). Log of sales is log of nominal sales revenue (in millions of dollars). Market to book is market value of equity plus total liabilities divided by total assets. ROA is return on assets measured as the ratio of net income to total assets. Leverage is measured as the ratio of total debt to total assets. Industry controls are based on one-digit SIC industry definitions. a Denotes significant at the 1% level. b Denotes significant at the 5% level. c Denotes significant at the 10% level. Contents lists available at ScienceDirect Journal of Corporate Finance journal homepage: www.elsevier.com/locate/jcorpfin 0929-1199/$ – see front matter © 2008 Elsevier B.V. All rights reserved. doi:10.1016/j.jcorpfin.2008.09.013