A Study On Construction Of Compensation System Of Senior Excutives In FJ Company Under Relative Performance Evaluation System

In recent years in China, compared with GDP and company performance, the growth rate of CEO’s salary has greatly exceeded them, even the sky-high annual salary has come out. However, with the outbreak of the global financial crisis, governments noticed that executive salary system is unreasonable. No matter in the United States, Western Europe, or Southeast Asia, even our government has set the guidelines in salary limits, then "one-dollar annual salary" and "zero annual salary " came out. No matter“sky-high annual salary”, "one-dollar annual salary" or "zero annual salary ", all revealed current drawbacks of executive performance evaluation system and salary incentives system in China. To establish and perfect the executive salary system has become a top task. The establishment of reasonable executive salary system should be based on objective and fair performance evaluation. Therefore, it’s of great theoretical and practical significance to achieve the followings: to research how to exclude uncontrollable factors on executives performance evaluation; to more truly reflect the executive’s management level and effort by executive performance evaluation results, to set a scientific executive salary system on the above basis.By introducing the relative performance evaluation theory and comparing it with traditional absolute performance evaluation, this article analyses its application in determining executive salary, which helps to exclude effect from objective environment against executive performance and is good for playing the incentive role. It chooses FJCompany for the research. Firstly, it makes an assessment of current CEO salary status in FJCompany; secondly, on the basis of basic theory of relative performance evaluation and existing research results, as well as current advanced performance indicator system, it designs a complete set of reasonable relative performance evaluation system; finally, by comparison of Chinese and foreign executive salary models, combination of special characteristics of our economic development and FJ Company, re-set executive salary mechanism on basis of relative performance evaluation system, bring forward measures such as perfect governance structure, strengthen information management, accompanied by spiritual incentive; it could be used as reference in other fields.