| As the social recognition of the individual based on the tournament-based social comparison and social evaluation mechanism,The award highlights that the levels of winners’ individual efforts and ability are higher than those of the other competitors,enhances the social status and reputation of the winners and contributes to subsequent economic resources,which enhances the space for further development in the future.Also the awards form effective restraints and incentives for the winners through the reputation mechanism.Western society has always pursued individualistic cultural values and values the realization of personal dignity and self-worth.Therefore,Western scholars generally focus on individual-level awards when studying the award-winning issues.The winners in Western society are more individuals than collective,and previous studies have interpreted the awards from different perspectives.This article summarizes them as “signal view”,“incentive view” and “asset view”.The “signal view” believes that the awards transfer relative competitive advantage and status of the winners among the competitors,and further enhance its industry status and reputation as the external shock.Based on “signal view”,the “incentive view” considers the individual’s desire for the realization of dignity and self-worth,and improves the current salary income and career development based on the improvement of personal reputation and interindustry competitive position.Therefore,the reputation promotion effect caused by the award-winning effectively promotes individuals to actively participate in social comparison and industry competition,and reduces agency problems.The “asset view” believes that the reputation generated by the awards will attract more external resources to flow into and constitute winners’ assets in a cheaper way to further enhance their competitiveness.Since the Chinese pursue the collectivist cultural values,it is considered that the ability of individual’s value creation depends on the performance of the collective organization.The social recognition of individual ability and status is placed under the framework of collective organization evaluation.And more emphasis was placed on the evaluation of the competitive position at the collective organization level when making social comparison.Based on this,through studying the annual report of China A-share listed company,we find that some companies disclose a series of information about their awards and honor in addition to the detailed analysis of the company’s financial indicators and the completion of the business objectives near the “Management Discussion” section.According to the nature of the awarding institutions,the corporate awards are divided into three types,namely national awards,local awards and industry association awards.The data about corporate awards from 2008-2016 are manually collected through text analysis and manual identification.With reference to the conclusions and opinions of the existing research on the nature of the award and its economic consequences,the research discusses the impact of corporate awards on the managerial behavior and the incentive level of the compensation contract,and further investigates that the awards how to influence the pay gap between managers and their peers and the incentive effect from the perspective of the tournament-based social comparison and evaluation mechanism.Firstly,based on the existing research,it is believed that managers have the motive of improving financial performance through earnings management.This research demonstrates the impact of corporate awards on managers’ earnings management motives and possible industry spillover effects from the perspective of non-financial performance.Corporate awards effectively reflect that the manager’s ability and effort in business management is significantly higher than the industry’s general level,which reduces the information asymmetry between the principal and the agent,thus weakening the motivation of managers to use the earnings management means to improve financial performance.Simultaneously corporate awards increase their peers’ incentives for financial performance by increasing the competitive pressure of unawarded corporate managers among their peers,thereby increasing their current earnings management.Further considering that the awards between state-owned enterprises and non-state-owned enterprises have different economic implications.Because the state-owned enterprises bear multiple management tasks,it is difficult to evaluate the operation conditions merely through financial performance indicators.The ranking and competitive position of stateowned enterprises in the tournament-style social comparison and social evaluation mechanism have been included in their business assessment.Therefore,it is found that the effect of the company’s award-winning on the reduction of managers’ earnings management is more significant in the state-owned enterprises.The conclusions of this chapter are still valid after controlling for possible endogenous problems,sample selectivity bias and other issues.Secondly,the information asymmetry between inside and outside of enterprises makes it necessary to make a clear contract with managers in order to reduce the moral hazard,and to link the managers’ salary level with the financial performance,thus effectively encourage managers to strengthen their effort in management and improve their management performance in a quantifiable way.However,with the expansion of the scale of enterprises,it is difficult to fully reflect the managers’ effort by solely relying on the financial performance indicators of enterprises because of the complexity of the business environment and operation tasks,and even easy to cause managers to to be short-sighted and opportunistic behavior.Therefore,through market competition and industry comparison.the ranking and the evaluation results of external stakeholders under the mechanism of social comparison and social evaluation can help to measure managerial competence level and degree of effort.It is found that when the managers’ management ability and investment are recognized by the society and superior to their competitors,the managers’ salary in award-winning enterprise is improved.Moreover,the salary gap within the enterprise is increased,and the inequality of income distribution within the enterprise is aggravated.Thus,the corporate awards achieved by the collective efforts of managers and ordinary staff eventually benefit managers more,and the higher the managerial hierarchy,the greater their benefits.Therefore,the idea and direction of effectively distinguishing between individual performance and collective performance is proposed to solve the problem of income distribution gap enlargement.Thirdly,this paper turns the research perspective to the outside of the enterprise.Because the awards result from the mechanism of social comparison and evaluation based on the tournament,and the managers’ salary is often referred to the salary level of their peers.Will the higher level of managers’ management ability reflected by the corportate awards and higher level of managers’ compensation increase the salary gap between managers and their peers? Empirical investigation results show that the salary gap between managers and their peers has been increased significantly after the award.managers’ management ability and their social recognition make their salary level significantly higher than other managers in the same industry,and the award-winning in state-owned enterprises has a more obvious impact on the increase of external pay gap.Moreover,considering the existing market position of the enterprises and industry competition,it is found that the higher the market position of enterprises and the more fierce the industry competition they face,the more obvious the effect of corporate awards on the increase of external pay gap.The higher level of the salary gap caused by corporate awards,the more obvious the incentive effect and the higher level of the market value of enterprises will be.Finally,this thesis summarizes and reviews the relevant research findings,and puts forward pertinent suggestions.Besides standardizing the disclosure of awardwinning information in annual reports,for corporate awards as a result of collective efforts,how to effectively distinguish organizational collective performance from personal performance of managers or ordinary employees,thereby reducing the gap in income distribution and improving the work efficiency of ordinary employees? In addition to monetized pay,use the corporate awards as incentive measures rationally to control the problem of income distribution gap enlargement.On the basis of the research in this paper,we can further explore the influence of corporate awards on the investment and financing options and the behavior of investors,analysts or auditors.To discuss the enterprise awards in detail,we can subdivide the types of enterprise awards according to different standards,such as Corporate Innovation and social responsibility.Then it can be further studied that how the awards of enterprises in different fields influence the follow-up managerial behavior of enterprises and the response of external stakeholders. |
