CEO compensation at U.S. public firms is increasingly interlinked with long-term accounting performance.

Lingling Wang, an assistant professor of finance at Tulane University, underscores this point in a new blog posting on the Harvard Law School Forum on Corporate Governance and Financial Regulation.

In her posting (based on a paper she co-wrote), she notes that 16.5 percent of S&P 500 firms adopted multiyear accounting based performance incentives. By 2008, that number grew to 43.3 percent. Benchmarks for evaluation include earnings, sales, cash flows or efficiency measures.

Why has this trend grown so much? Wang wrote that long-term accounting performance measures are more likely when the market is less volatile. They are also thought of in connection with a firm’s strategic priorities.

Interestingly, these types of CEO incentives grew primarily after 2002.. Those early adopters also had “the highest stock to accounting volatility ratios, the longest shareholder horizons and the most independent boards,” according to the posting.

Click here to read the blog posting in full.