An Empirical Study On Relationship Between Executive Incentive And Corporate Performance

In the current context of economic globalization, especially in the aftermath of the financial crisis, the problems about the impact on corporate performance which comes from executive incentive or what kind of incentive combinations can be able to excitate the power of managers have become the new attention to the experts and scholars.The high-tech company has the most developed technology and advanced management methods, and has a pivotal position in economic activity,and now is a new growth point in today’s economic development.Senior management staff are the significant human capital of the corporate, and are the decision-makers of all operational activities of the company to lead and support the company’s operational activities carried out and the upgrade of the company’s operational capabilities, and also can be effective co-ordination arrangements both inside and outside the company a variety of resources to achieve the stated objectives.Because of the incentive is directly related to what kind of performance does the company achieve, choosing the empirical study on relationship between executive incentive and corporate performance from the data of the high-tech listed company has an important theoretical value and practical significance.In this paper, we make use of the normative and empirical research methods to study the relationship between executive incentives and company performance for the high-tech listed company on the basis of existing research.First, classifying summary of related literature, we have obtained three measures of executive incentive to affect corporate performance:pay, ownership and on-the-job consumption.After that we define the concepts of high-tech listed company, executives, incentives and corporate performance and list the correlation theory of executive incentive and corporate performance.Secondly, considering the characteristics of Chinese high-tech listed company,we descriptive statistical analysis on the executive compensation, ownership and on-the-job consumption.And we use ordinary linear regression to analysis the relationship between executive incentives and company performance for142high-tech listed company,which be tested by stepwise linear regression.The empirical results show that:in the high-tech listed company, it’s a significant positive correlation between the per capita salary of the executive, the proportion of managerial ownership, the proportion of shareholding executives and corporate performance; it’s a certain degree of negative correlation between the executives serving consumer and corporate performance; the proportion of salaried executives and corporate performance does not exist a significant correlationFinally, on the basis of theoretical analysis and empirical analysis,we will mention countermeasures recommendations to improve company performance for the high-tech listed company.