Research On The Motivation Mechanism Of Top Managers In Chinese Listed Companies

Through corporate governance theory such as property right theory, agent theory and stakeholder theory, and motivation theory such as tournament theory, cotent-type motivation theory and process-type motivation theory, this paper systematically analyzed the construction of motivation mechanism of top managers from the view of management and governance. Base on principle-agent theory, this paper analyzed the mechanism of principle-agent motivation in the two conditions: information symmetry and insymmetry. Through exploring the mechanism of company performance, this paper constructed linear model of company performance and linear motivation model of top manager. Then introducing stock option motivation variable, this paper analyzed the mechanism model between top managers'motivation based on stockholder and company performance.After analyzing the three basic motivations of top manager, compensation motivation, stock option motivation and control right motivation, this paper designed the motivation indicators of top managers. Most Chinese listed companies were reformed by state-owned companies. Therefore, the formation of"national single bigger stockholder"and the absence of owner lead to"insider control". The balance of"insider control"has been the key problem of motivation mechanism of top manager. This paper designed relative indicators to measure"insider control".By investigating the 100 listed companies, this paper made a description and grouping statically analysis of top managers'motivation. After analyzing the relation between top managers'motivation and company performance, the results show there are significant positive relations between top managers'motivation in 2004 and the company performance(ROA,EPS and Tobin's Q) in 2004, 2005 and 2006 individually. The better the top managers'motivation is, the better the company performance is. Finally, based on the theory deducing and demonstration, model analysis results and empirical test results, this paper put forward some designing principles and dominant model of top managers'motivation mechanism in Chinese listed company.