Research On The Relationship Between Executive Compensation And Enterprise Performance Of The China Growth Enterprise Market Listed Corporations

With the rapid development of market economy, the competition becomes fierceramong enterprises，mainly reflected in the competition between human capital in theenterprises. As the important way of enterprise incentive talents, Executivecompensation is the focus of academia and practice in the world. China GrowthEnterprise Market is a new area in the development of capital market, it bear theimportant mission of breeding and cultivate the enterprises which are in the stage ofinnovation-type. Therefore, how to motivate the gem company’s senior managementto create wealth for the company, how to promote the gem companies stabilitysustainable development is beneath more attention of all sector in economic society.Based on the gem companies in China, this paper aims to study the relationshipbetween executive compensation of Growth Enterprise Market Listed Corporationsand corporate performance. Selecting the company’s annual report data from2010to2012, the study use company size、the structure of corporate governance、region andindustry as control variables to analyze the relationship with SPSS17.0. The conclusionis that executive compensation significantly positively correlated with corporateperformance; under the influence of enterprise scale, compared to the small sizecompanies, the correlation between executive compensation and corporateperformance is more significant in the large size companies. Besides, under theinfluence of executive shareholding, the companies which have the lower executiveshareholding ratio will pay the more compensation to the executives, and the positivecorrelation between executive compensation and corporate performance is moresignificant. In addition, influenced by regional differences, the executive compensationof gem companies which located in the eastern region is significantly higher than otherareas. This shows that the relationship between executive compensation and corporateperformance in the gem companies of China is affected by many factors, evaluate theinfluence factors reasonably, combing with the current economic and socialdevelopment to improve the gem company compensation system, this action will not only make the companies have a long time development, but also make the reasonableallocation of resources and balance the resource in the society.Finally, according to the results of the study, there are some suggestions for theexecutive compensation system of Growth Enterprise Market Listed Corporations. Atthe same time, it also pointed out the defect in this paper and the direction for furtherresearch.