Pay Gap Of Senior Management Team,Political Connections And Environmental Information Disclosure Quality

In recent years,the problems of environmental destruction in some provinces and cities in China have become more and more serious.Air pollution,water pollution and soil pollution are all the concerns of the whole society.Environmental disclosure improves the communication between enterprises and stakeholders,and promotes performance of environmental responsibility.At present,the quality of corporate environmental information disclosure in our country is generally low.How to improve the corporate environmental information disclosure quality is the focus of the public.The existing literature about the influence factors of environmental information disclosure behavior mainly focus on the corporate governance,external supervision and so on but the conclusion is not unified.Though Senior managers as the business decisions makers have a greater discretion in disclosing environmental information,few literature from the senior manager team's perspective on corporate environmental disclosure.This paper studies the correlation between pay gaps of the senior management team and the environmental information disclosure quality,and further examines the impact of political connections on the relationship.Firstly,this paper introduces the classic theories of corporate environmental information disclosure behavior,corporate governance and compensation incentive.Then this paper analyzes the relevant literature domestic and abroad in order to provides the theoretical and literature foundation for follow-up research.Secondly,this paper summarizes the evolution process of China's environmental information disclosure system,senior managers compensation incentive system and the “pay restraint” policy.It also constructs a theoretical analysis framework for the relationship among pay gap of the senior management team,political connections and the environmental information disclosure quality.Thirdly,designing the corporate environmental information disclosure quality index evaluation system by Adopting content analysis method.Empirical study of the relationship between pay gap of senior management team and corporate environmental information disclosure quality,and further examines the regulating effect of political connection on the relationship.The results reveals that pay gap of senior management team is significantly negatively correlated with the environmental information disclosure quality.It means that the greater the pay gap of senior management team,the lower the environmental information disclosure quality,which supporting “behavioral theory”.In comparison to non state-owned enterprises,the negative correlation is more pronounced in state-owned enterprises.Political connections undermine the negative correlation between pay gap of the senior management teamm and the environmental information disclosure quality.The higher the environmental regulation,the more significant of political connection regulation.Finally,based on the above findings,this paper presents a series of policy suggestions on optimizing the disclosure behavior of corporate environmental information.This paper expands the influence factors of the environmental information disclosure quality.Enriching the literature on the economic consequences of pay gap of senior management team.Providing new empirical evidence of the effectiveness of “pay restraint”policy.Moreover,it can provide policy reference for improving the quality of environmental information disclosure.