The Research Of Executive Compensation, Corporate Dividends And Enterprise Performance

In recent years， the situation that" Executives high salaries, low dividendsshareholders" is widespread in our country enterprise. In2012，the economic situation is ina state of turmoil downturn，although the Share price of the listed company hits a new low，but executives are given to astonished millions of annual salary. Against this background，Executive pay once again becomes the focus of attention from all walks of life，therelationship between the executive pay、 Companies pay dividends and Enterpriseperformance becomes the key problems urgently need to discuss.At present most of the theoretical research is made on executive pay and corporateperformance, corporate dividends and corporate performance respectively in our country，the research on the relationship between the executive pay、Companies pay dividends andEnterprise performance is relatively less. Existing research shows that executive pay ispositively related to corporate performance，while Companies pay dividends is positivelyrelated to Enterprise performance. However，the Executive pay serves as the incentivemechanism and Companies pay dividends serves as a constraint mechanism, and there is aproblem that where there is some kind of relationship between the Executive pay、Companies pay dividends and Enterprise performance,although the existing literature hasdiscussed it in terms of theory, but there is a lack of empirical evidence to support it. Thisrequests us take China’s market environment as the background, deeply research therelationship of our country enterprise executive pay, dividends and performance, determinethe reasonable compensation levels, and further explore the incentive salary mode so as torealize effective incentive and constraint of executive.This paper bases on a sample of Chinese listed companies between2006and2010,through the way of Using simultaneous equation model, this paper empirically analyze therelationship between the executive pay、 Companies pay dividends and Enterpriseperformance and discuss what kind of relationship between the impact of the executive payand Companies pay dividends on enterprise value exists. The empirical results show thatChinese enterprises in general, enterprise value is significantly positively related to explicitcompensation. explicit compensation motivate managers to improve the enterprise value.But Enterprise performance and dividends is no significant correlation. compensation andcorporate dividends is a positive correlation relationship. We also found that The nature ofownership will have an impact on executive compensation, corporate dividends andcorporate performance. Non-state-owned enterprises, the explicit compensation will notsignificantly impact on enterprise value. In the state-owned enterprises compensation canimprove enterprise value. In non-state-owned companies, On-the-job consumption andcorporate dividends have significant substitution relationship, and there is no suchrelationship in state-owned enterprises. In this paper,the result of study not only enrich thetheory of principal-agent theory and the equity agent, coordinate the conflict of interestbetween managers and shareholders, but also has strong implications on the design ofenterprise incentive mechanism and restraint mechanism.