The Influence Factors Of Top Executive Compensation In Listed Companies

With the scale expansion and the quality promotion of listed companies over the past 20 years, the role of listed companies in national economy developing process is becoming increasingly important and listed companies have become the mainstay of the national economy development. The top executives of listed companies are in charge of resource utilization and business performance of the whole enterprise, so they play a significant role in their companies. In the last ten years, the top executive compensation in listed companies has gained wide attention from all sectors of the society. The top executive compensation in listed companies is presenting a huge industrial difference, a huge regional difference, polarization, not tied to business performance and the other phenomenon. So what are influencing the top executive compensation of listed companies? What are the difference between the influences of different factors on the top executive compensation of listed company? Studying on the influence factors of top executive compensation in listed companies in our country to establish a more perfect executive incentive system, become a major problem in academia.Based on the domestic and foreign related researches about the influence factors of top executive compensation, this thesis has reviewed and summarized the classic literature and the related theories, using the hierarchical analysis method to divide the influence factors of top executive compensation into three levels-individual level, organization level and environment level. The hierarchical conceptual model about the influence factors of top executive compensation is established and 10 influence factors of top executive compensation in listed companies in our country are selected to test the relationship between these various influence factors and top executive compensation in consideration of both theoretical foundation and data availability determining the measuring indexes of these influence factors. This thesis uses listed companies in Chinese A share market as samples in three years (2012-2014) to test the relationship between these influence factors and top executive compensation of listed companies through the hierarchical linear model, and to contrast the impact of different levels’factors on top executive compensation.Results of data statistics and analysis confirms these factors in this essay, eight of which has a significant relationship with top executive compensation. Specific research indicates that:(1) Human capital has a significant positive correlation with top executive compensation in listed companies, that is to say, the executives’age, education and tenure are all positively related to top executive compensation in listed companies; (2) Enterprise performance is positively related to top executive compensation in listed companies and enterprise performance is the most important influence factor; (3) Enterprise scale had a significant positive correlation with top executive compensation in listed companies, and the regional economic development level will weaken the positive correlation relationship between enterprise scale and top executive compensation; (4) The proportion of state-owned shares is negatively related to top executive compensation in listed companies; (5) Duality of CEO and chairman has a significant positive correlation with top executive compensation in listed companies; (6) The regional economic development level is positively related to top executive compensation in listed companies. In addition, this thesis finds that the impact on top executive compensation in order from high to low is the individual level, the organization level and the environment level. On the basis of these empirical.results, this thesis puts forward five suggestions on how to help the listed company to establish a more perfect executive incentive system:(1) Establish a executive compensation system associated with human capital; (2) Perfect the evaluation index system about the executive pay; (3) Continue to improve the current independent director system; (4) Perfect the corporation governance structure; (5) Rationalize the proportion of state-owned shares. In addition, this thesis summarizes the limitations of this study and put forward future research trends.