Research On Executive Compensation Of Listed Companies And Business Performance Correlation

Pay contract can produce effective incentive for executives, thus increasing corporate performance is an important issue of concern academics and practitioners. Separation of ownership and control of listed companies has led to the generation of executive compensation incentive problem exists between business owners and business operators the target is not unified, information asymmetry. As the economy continues to develop, companies are facing more complex business environment, conflicts of interest among business owners and operators intensified and effective compensation incentive contract mechanism can alleviate agency conflicts. On the other hand, operating personnel has become an important factor in the competitiveness of enterprises, senior management personnel has become the core competitiveness of enterprises, so the most important development of the enterprise is that through the introduction of high-end talent, and implement effective incentive system to improve the business interests of the purpose of this paper focuses on what kind of contract can pay better incentives to executives to reduce agency conflicts, thus increasing corporate performance.Based on the Principal Agent theory and corporate governance, we use data of listed companies between 2010 and 2014, studied the empirical analysis of executive compensation incentive effect on business performance. Firstly, to conduct a comprehensive statistical analysis of executive pay, and to clarify the causes of these phenomena, and thus the method of hypothesis and empirical research to test the hypothesis put forward. Finally, the empirical research and analysis are summarized, presented to executive compensation contract design recommendations for improvement, to improve the corporate governance of the company comments.Through the research, the main conclusions of this article are:a positive correlation between executive compensation and business performance significantly positive correlation to verify the effectiveness of executive compensation incentive; compared to private enterprises, state-owned enterprises executive pay can for executives play a more significant incentives; listed companies compared to one of two jobs, two jobs separate listed company’s executive pay contract able to play a more significant incentive. For research results, this paper proposes policy recommendations in three areas:First, improve the modern enterprise management mechanisms, and second, to establish a reasonable system of executive compensation, the third is a reasonable performance evaluation system design...