The Analysis On The Influence Factors Of Executive Compensation Based On Panel Data

Executive compensation system, as an important part of corporategovernance, and to solve the principal-agent problem in corporate governance, hasattracted more and more attention in academic and industrial circles. Enterprises needa number of senior managers who understand management and can operate thecompany, while the proper compensation system plays an important part inmotivating, attracting, developing and retaining core talent. At the same time thesalary of senior executives is also related to the fairness of society, and the reasonableexecutive compensation is an important part of social income fair.This paper is based on the corporate governance theory, the principal-agent theory,human capital theory and incentive theory, in order to make the conclusion moreconvincing, this paper broke the tradition of using time series data-only one companyfor many years data or using cross section data-multiple for one year data for practice,taking panel data for many years more companies of30listed enterprises of iron andsteel in recent three years as the study sample. At the same time in order to ensureconsistency and validity of the data, this paper select A shares, excluding the extremevalue of enterprises, and to ensure that the sample firms in recent three years are listedranks. We use panel data, analyzes the relationship between the companyperformance, enterprise scale, board size, independent director’s proportion, theproportion of state-owned stock, area and the executive compensation of the samplefirms.The results show that: there is a positive correlation between executive compensationof iron and steel enterprises and company performance, if other cases unchanged, thecompany performance increase each10000yuan, the average company executivessalary will increase2100yuan; the size of company is positively related withexecutive pay of iron and steel enterprises, if other cases unchanged, the size ofcompany increase each10000yuan, the average company executives salary willincrease2600yuan; the board size has a negatively correlated with it, if other casesunchanged, the board size increase each person, the average company executivessalary will decrease3500yuan; independent director’s proportion is positively relatedwith executive pay, if other cases unchanged, independent director’s proportionincrease each person, the company executives salary will increase11600yuan; theproportion of state-owned shares is negatively correlated with it, if other casesunchanged, the proportion of state-owned shares increase each10000yuan, thecompany executives salary will decrease2000yuan; the enterprise location ispositively related with it. if other cases unchanged, per capital GDP increase10000,the average executive salary will increase22700yuan. In view of there are lots ofdifferences for the listing corporate among the company performance, enterprise scale, board size, independent director’s proportion, the proportion of state-owned stock andarea, the results of this study just for reference.According to the above conclusion, we put forward the following suggestions onperfecting the executive compensation incentive mechanisms of the iron and steellisting enterprises: one way is to strengthen the control of executive compensationlevel in iron and steel enterprises; the second way is to reform the executivecompensation structure in iron and steel enterprises; the third way is to improve thesystem of executive compensation.