The Empirical Research On Top Executive Compensation Of Chinese Listed Enterprises

It is the issue of executive compensation that leads to a long debate on Foreign academic. So far, though there have been a lot of researches done by variouse schools from different perspectives on executive compensation, there wasn’t an exclusive theory which could simultaneously grasp a number of the most important characteristics of executive compensation. This article firstly looks back and sorts out the relevant theory, and secondly tests the general human capital’s impact on executive compensation by the method of combining normative and empirical researches. At the same time it also summarizes and examines other factors for executive compensation.This article selects all the constituent stocks of the CSI300Index from the year of2005to2010as the initial sample to establish multiple linear regression models including mixed regression, fixed effects and random-effects model regression. The empirical results show that there’s a significant positive correlation between the general skills and the compensation for manager. It implies the society has paid increasing emphasis on the general skills at the context of the increasing executive pay. What is more, our review suggests that both managerial power and competitive market forces are important determinants of executive pay, but that neither approach is fully consistent with the available evidence.There could have been several innovations in this article:First, it is the data collection. Because of the lack of the data about CEO’s personal emoluments, most literatures use the average wage of the highest paid in the top three executives as a proxy variable for CEO pay. In this paper, I select CEO’s personal emoluments as the study object to improve the empirical study of the relevant literature from the CEO personal perspective on executive compensation. Second, it is the theoretical methods. So far there are few literatures referring the general human capital’s impact on executive compensation in china, therefore, this article introduces the concept of general human capital model and explains that the rising level of relative importance of the general human capital improved the executive compensation. That enriches and improves the theories and methods of the executive pay of listed companies in China. Third, it is the construction of the index about the general human capital. This article uses the CEO’s personal characteristic as a proxy variable for the general human capital.