Research On The Impact Of Control Configuration To Enterprise Executive’s Corruption

With the change of economic and legal environment, the Party and the State presented a newanti-corruption since the18thNational Congress of the Communist Party of China. Corruptionsof executives exposed have been more and more attention from all walks of life. Executivecorruption is stirring for the depth, breadth and the large amount of money. Executive corruptioncaused serious consequences to the State, Society and Enterprise. It is the obstacle in deepeningenterprise reform journey. To promote the healthy development of enterprise economic,anti-corruption governance is imminent.This article focus on the root of executives corruption——control to explore its influence oncorporate executives corruption mechanism from the perspective of control configuration. Theeffective configuration of enterprises control depends on the power configuration andcounterbalance degree of the shareholders, the board of directors and managers. Throughtheoretical and empirical test, the regression analysis conclusion of this article is that, from theshareholder level, if the control is relatively concentrated, the possibility of executive corruptionoccurring reduce. Size of the board of supervisors does not play the supervision role in theexecutive’s corruption. Because of its extreme weakening function, the likelihood of companyexecutive’s corruption increases. From the board level, the board size and corporate executive’scorruption significantly positively related. The board size is too large to dysfunction and the"free-rider" behaviors weaken its functions. The proportion of independent directors and auditcommittee set up are negative correlation with the incidence of executive’s corruption. Thissuggests that the independent directors and audit committee have playing a positive role forconstraint executive behavior. From the manager level, the greater the power of the CEO, thegreater the managers control contributed to the executives of corruption. According to thedifferent of formation of control mechanism, we can conclude that relative to Private Enterprises,State-owned holding company shows more significant relation between different level controland executive corruption.In this paper, the research results show that the unbalance of control configuration is directlyrelated to corporate executive’s corruption. Optimizing mode of control configuration andimproving the corporate governance structure are likely playing a positive role to reduce the occurrence of corporate executive’s corruption. In this paper, the research provides the necessarytheoretical foundation and empirical evidence for preventing executive’s corruption. Meanwhile,this paper also enriched the factor literature of executive corruption.