A Study On The Impact Of Performance Assessment On Executive Change

In recent years, the SASAC issued a series of regulations and measures to advance executive performance assessment, EVA, 360 degrees KPI and key performance indicators are continuously introduced to the executive performance assessment, The document pointed out that the performance assessment results will be associated with executives appointment and salary. Under these regulations, Whether the design of executive performance assessment is reasonable and effective, will inevitably become the focus of attention. In particularly, Whether implementation of executive performance assessment have impact on top management turnover? When a company implement executive performance assessment, What is the influence of strength and specific evaluation indicators on top management turnover? Whether the sensitivity of management turnover of different company to executive performance assessment have differences? What are the reasons? In view of the above problems, this paper has carried on deep research. Firstly, sorting out and summarizing the related studies on executive performance assessment and management turnover at home and abroad Secondly, this paper makes a deep theoretical analysis about the correlation of executive performance assessment and management turnover. Then, the article also carry on statistical analysis on present situation of executive performance assessment and management turnover. Finally, in view of the existing research hypothesis,using STATA11.0 statistical software, this paper carries on the descriptive statistics, person correlation analysis, multiple linear regression analysis and grouping comparison, this paper focus on 2010-2013 years the Shanghai A shares market listing corporation executives performance assessment and management turnover through the empirical analysis, To research the effect of executive performance assessment implementation situation, the strength and the main indexes on top management turnover. The conclusions of the thesis as follows:(1)The implementation of executive performance assessment can effectively relieve the change of top managers. With the implementation of the listing Corporation executives performance assessment, the possibilities of management turnover and management abnormal turnover are reduced significantly.(2)Performance assessment is more severe, top management turnover is more likely to happen. When comprehensive score of executives performance assessment is higher in the listing Corporation, executives are more easier to change. However, the effects of Performance assessment on management abnormal turnover are more great and significant.(3) The effects of net profit growth rate and earnings per share effect are obvious for management turnover, but the growth rate of net assets and net cash flow per share have no obvious influence. On the relationship between executive performance index and management turnover, growth rate of net profit and earnings per share are more higher, the smaller possibility of management turnover is, however, when the growth rate of net assets and net cash flow per share are higher, executives are more likely to change. Especially, the effect of these indicators to management abnormal turnover are more strongly and significantly.(4) In the central holding company, the implementation of performance assessment is more effective, and earnings per share has significant influence on management turnover in the state-owned holding company.By comparing, the study find that: First of all, the implementation of executive performance assessment is beneficial to reduce the possibility management abnormal turnover in central holding company, it shows that the goal orientation of central enterprises performance assessment is relatively strong, the effect is also significant; Secondly, in the executives performance assessment system of state-owned holding company, net profit growth rate and earnings per share are negatively correlated with executives change, especially the earnings per share, it can strong constraint and incentive executives, when earnings per share increases,the possibility of management abnormal turnover is likely to significantly reduce. This shows that the design of these two indicators is useful to maintaining the stability of executives. Then, in the executives performance assessment system of private company, earnings per share shows strong influence on the management abnormal turnover.(5) In the private company, incentive effect and substitution effect of executive performance assessment are not obvious. the implementation of executive performance assessment is negatively correlated with the possibility management turnover, but it is not obvious. It indicate that the incentive effects of private company executive performance assessment is not obvious. At the same time, the private company executive performance assessment strength and management turnover does not show significant positive correlation, so the substitution effect of performance assessment is also not obvious.The value of this study is to provide reference basis for the board of directors of the listing Corporation in improving executive performance assessment system, and also provide some reference for the policy decision of the Ministry of finance, Securities Regulatory Commission, In addition, it can also provide policy recommendations for the SASAC to face the new problems of executive performance assessment in the company development process, it has certain practical significance.