Study On The Affecting Factors Of The Top Management Team's Pay Gap In High-Tech Enterprises

With the development of modern enterprise management system and the separation of ownership and managerial authority, the principal-agent system has been the most basic pattern of property rights model in modern companies. The senior managers of companies who make decisions play a vital role in the development of enterprises, especially that of high and new tech enterprises.Besides, the salary incentive mechanism to the managers has become an important part in the management of enterprises, that is to say, to make the owners and managers "incentive compatible",which is not only a difficulty but also a hot part in the study of enterprises management.There are two focal problems in the design of the salary incentive mechanism:pay levels and pay gap. Currently, studies at home and abroad mainly focus on the absolute level of executive pay,while the studies on the pay gap among executive teams are much less.Pay gap exists in any organizations and under any circumstances and it refers to a difference in salaries because of different kinds of jobs or the capability of the employees. The pay gap between executives within the team reflects the distribution and and allocative efficiency of salaries.This paper selects the high-tech enterprises as the research object and takes the IT trade, pharmaceuticals industry and Biological industry as the two representatives industries.Based on the financial figures of listed companies between 2006 and 2008,the writer tries to have a study on the forming of pay gap differences among top managers, and further reveal the current situations of pay gap and the factors that may cause such differences.This paper argues that the forming of pay gap between executives within the team depends on top management team business owners, and it also includes the affecting factors into three layers:the team level, the enterprise level,and environmental dimensions.Furthermore, through empirical examinations this paper proves that tournament theory can be applied to new high-tech enterprises,which can provide valuable experience for the analysis of China's enterprises salary structure and salary decision-making mechanism.