| With China’s listed companies the increasing number and scale expand, the executivecompensation, although in general enterprise show a rising trend, there was some abnormalchange in individual: some loss of company executives are still getting rich high salary;Instead, the performance good company executive pay is not extrude; Some companyexecutive pay much faster than the growth of the enterprise performance. Obviously, thedevelopment of executive compensation in our country have deviated from "the mostoptimal contract theory," to a certain extent, the executive pay is no longer linked toperformance, its taking less incentive effect, therefore, the listed company executive payeffectiveness studies is imminent for our country.This paper adopts rules analysis and empirical analysis combining to study theeffectiveness of executive pay. Research shows that, in order to protect the interests ofshareholders and investors, the incentive contract of the executive pay and performancecombining is effective. But the principles of executive pay incentive contracts are complex,and they do not have transparency. Although the final purpose of incentive is to improvethe enterprise value, improve performance, but the executive pay incentive contracts willset by numerous company internal or external factors, the impact is likely to improve theeffectiveness of the incentive is positive effect, there may be a negative interference onincentive effectiveness.Previous studies on the effectiveness of executive pay incentive contracts, theyconsideration the company scale, risk, growth and industries and regions, and corporategovernance structure factors wealthy, it is important for entrepreneurs payment theory andmanagement theory. This paper based on the study of executive compensation andcorporate performance relationship, in allusion to China’s local market degree of different,study the system environment on executive compensation and the corporate performancerelationship influence; At the same time, this paper further considered the relationship ofthe government intervention on executive compensation and corporate performance effect,according to whether the government control for enterprises are classified, empiricalanalysis respectively. At last, this paper also considering the market process, control thehuman nature influence the executive compensation and corporate performancerelationship. We can say, this article added a new perspective for executive pay research,and it has certain practical significance to perfect our country listed incentive mechanism,also it can help our government better play the functions of government. This paper on the basis of theoretical analysis, building the regression model, using2007-2010years of the listed company data carried on the real diagnosis analysis, theresults show that:(1) executive compensation and corporate performance correlation exists,and significantly related, namely the listed company executive compensation contracts hasincentive validity.(2) market index and executive pay significant positive correlation,(3)relative to the government for control of the company, non-governmental control companyexecutive compensation has more incentive contract effectiveness.(4) the market processfor non-governmental control company executive compensation contracts and theperformance of the sensitivity of the more influence, and for government control of thecompany executive compensation contracts and the performance of the sensitivity of theinfluence is relatively minor.Finally, this paper gives the following Suggestions: the company governancemechanism with the system change environment and the corresponding dynamicadjustment, only to adapt to the environment of the corporate governance structure wasable to bring into full play. On the government’s economic function to further adjustment,to safeguard the development of market economy benign track; The government should bereduced to the market and enterprise intervention, to give full play to market self adjustingfunction. |
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