Research On The Influence Of Executive Compensation Of Listed Central State-owned Enterprises On The Corporate Performance

Reform measures to central state-owned enterprises are being carried out methodically, and the reform of executive compensation is particularly important. Now, public opinion believes that executive compensation is too high compared with the staff salary, and it has hindered the fairness of income distribution. The competition between enterprises has changed from the competition of production materials to the competition of talents with the continuous development of the market and the perfection of the modern enterprise system. The corporate performance of talents is far greater than production materials, and the most critical talent is the executive. Executives have an irreplaceable human capital which is a core factor in the long-term healthy development of the enterprises. So, more worthy of our attention is whether executive compensation has played the role of incentives compared with the level of executive compensation.This paper examines the influence of executive compensation on the corporate performance by selecting annual report data of 168 listed central state-owned enterprises from 2012 to 2014, and adds government regulation and executive stockholding as the moderator. Based on the analysis, this paper finds that executive compensation of central state-owned enterprises has a significant positive impact on the performance, but it only exists in a certain range of executive compensation. What’s more, this paper finds that government control has a significant positive regulation on executive compensation and the corporate performance, but the positive regulation of executive stockholding is not significant. According to the results, the relevant suggestions are proposed. First, the reform of executive compensation is not a simple salary limit, and it is important for the government to determine the excitation range of executive compensation combined with the actual situation of central state-owned enterprises. Second, although government control has a negative impact on the performance, but it can significantly promote the incentive effect of executive compensation. So the government needs to grasp the degree of government control to make it the best by the constant exploration in the practice of reform. Third, the role of executive stockholding has not been reflected because zero holdings is a common phenomenon in central state-owned enterprises. So it is necessary to consider increasing the proportion of executive stockholding in the future reform of executive compensation.