Research On Managerial Incentive Mechanisms, Cultural Difference And Performance Of Transnational M&A

At the end of20th century, the western developed countries started the fifth M&A wave, and the M&A has become an important way for enterprises to enlarge the market and acquire resources in the global market. Since entering21st century, with the improvement of Chinese enterprises’ international competitiveness and the strong support of Chinese government, more and more Chinese enterprises carry out the strategy of "going out". The studies of many researchers from the theoretical and empirical analysis show that it is difficult to win for Chinese enterprises when they merger or acquisition other enterprises in overseas.First of all, we summarized the results from abroad and home scholars of management incentive mechanism and the difference of culture, which are related with the performance of transnational M&A. Secondly, we put forward four hypotheses on the relationship between managerial incentive mechanisms, the difference of culture and transnational M&A performance. Thirdly, we use the method of DEA-Malmquist to analysis the transnational M&A of listed companies in China, and then empirical the hypotheses. Finally, based on theoretical analysis and empirical results, we put forward policy suggestions to optimize our managerial incentive mechanisms, improve the transnational M&A performance of China listed companies.The main conclusions are as below:(1)The managers’ monetary income is negative effect with the performance of transnational M&A, which shows the managers will launch M&A for personal gain.(2)By drawing on the management and supervision mechanisms of target enterprises, the perquisite consumption can be controlled, and it can improve the performance of transnational M&A.(3) The shareholding ratio of management has a negative relationwith the performance of transnational M&A in a long term, and has no significant relation with the performance in a short term.(4)Cultural difference has a negative effect with the performance of China listed companies. The differences of culture greatly hindered China’s enterprises to go out, and choose the target enterprises which have similar culture background with our country can improve the enterprises performance of transnational merger.