Research On The Relationship Between Management Compensation And Sustainable Growth Rate Of Listed Corporation

With the development of China’s capital market, the management of the listed Corporation has become the focus of the management and the majority of investors, executive compensation is an important aspect of corporate management mechanism. At present, most domestic and foreign scholars are keen on executive compensation or company’s sustainable growth. The relationship between executive compensation and corporate performance and corporate value is discussed mainly through the establishment of model. In fact, is it important about the impact of executive compensation on the long-term development of the company and the ability of sustainable growth? this paper, based on above problem, from the perspective of executive compensation and equity structure, discusses the influence of executive compensation on the sustainable growth of the company through theoretical and empirical analysis.Review domestic and foreign literature, the paper, based on principal-agent theory, expectation theory and asymmetric information-theory, discusses the relationship between the executive compensation and the sustainable growth of our country. In order to understand how to arrange corporate governance to achieve and maintain the sustainable growth of the company, and promote the research on the relationship between executive compensation and sustainable growth in practice, it has the significance in guiding the company to develop and implement sustainable growth strategy.First of all, the paper reviews and comments on the relationship between executive compensation and corporate sustainable growth rate. Then, the theoretical analysis is carried out and the research hypothesis is put forward, and the sample selection and model design are carried out, In the empirical analysis, we analyze the whole sample, the correlation test and regression analysis. Then, we use the fixed effect model to discuss the relationship between the ownership concentration and the sustainable growth. Finally, according to the results of empirical test, the paper draws the conclusion, and puts forward the countermeasures and suggestions for the research conclusions.This paper, based on the relevant theoretical basis, takes 2005-2012 years of China’s Shanghai and Shenzhen stock market as the research sample, puts forward the research hypothesis and uses the fixed effect model to study the relationship between executive compensation and corporate sustainable growth ability. Specific conclusions are as follows:(1) the executive compensation and the company’s sustainable growth is a positive correlation. It shows that the improvement of the executive’s monetary compensation can motivate the management to make the decisions which maximize the value of the company, and to achieve a positive effect on the sustainable growth of the company.(2) the ownership of executives is positively related to the sustainable growth of the company. The ownership incentive can make the utility function of the management function to the same as the utility function of the company owner, and it is beneficial to improve the company’s sustainable growth ability.(3) the increase in the concentration of ownership will strengthen the correlation between the executive compensation and the sustainable growth rate; the increase of ownership concentration will strengthen the relationship between the ownership of executives and the sustainable growth rate. Therefore, the company can increase shareholders holdings to promote the company’s sustainable growth.(4) the state-owned enterprise would weaken the correlation between the executive’s compensation and the sustainable growth rate, and the state-owned equity would weaken the correlation between the proportion of executives and the company’s sustainable growth rate. The state-owned property of the equity can weaken the sustainable growth of the company.