An Research On The Relationship Between Compensation Gap Of Intra-Listed Companies And Company Performance

The issue of compensation design of intra-companies has always been an important problem in the governance of company.,because the problem of pay gap will directly affect the internal employees’ mood, which also impact on corporate performance. The proper pay gap design can effectively motivate employees, and enhance the performance of the company, but without the proper compensation gap may let employees feel unfair, have the idle at work mood, thus can’t conducive to corporate performance.But most of the existing researches only discuss the relationship of the top management team pay gap and firm performance,the existing researches about the relationship between the pay gap between executives team and general employees and company performance are little relatively.And the conclusions are not consistent. And the existing research is more of a general regression analysis of the all listed companies, not on the comparative analysis of listed companies of different industries. So this article has important significance.on the basis of reviewing the relevant theoretical at home and abroad,First of all, analysis of the pay gap theory respectively from the perspective of game theory and behavior theory, then defines the relevant concepts, puts forward the assumptions, defines variables and builds the model. This paper selects the data from listed companies which are listed in Shanghai Stock Exchange and Shenzhen Stock Exchange from2007to2011, according to the classification method of the CSRC, descriptive statistics and draws related indicator for the listed companies of12industry, sums up the different sectors of the present situation of the listed companies pay gap, the relationship of salary gap and the corporate performance, and regression analysis on the correlation industry.The last is putting forward the corresponding policy Suggestions.The results of the empirical analysis show that the correlation of different industries pay gap with corporate performance is different, based on the different industry characteristics. Then the further research of six industry that both pay gap significantly correlated with corporate performance suggests that the compensation gap within the executive management team play the role of enhancement to the company performance.This result supports the tournament theory. Except the Communication and Cultural industry, the pay gap between executive management team and ordinary workers play the role of enhancement to the company performance. Then quadratic regression analysis, further found that the relationship between the salary gap and corporate performance is inverted "U" type of six industry.The main innovation of this paper is considering competition theory and behavior theory at the same time when researching the relationship of the compensation gap within the executive team、the pay gap between executives and employees, and the corporate performance, avoids the partial. It not only consider the monetary compensation gap, but also consider the return on equity gap, made the compensation gap more comprehensive.And this article analysis all divisions of listed companies in our country, not just for the general analysis of listed companies.