Research On The Influence Of Executive Compensation On Enterprise's Innovation Investment In The Presence Of Financial Constraints

Experienced a global financial crisis,global economic center of gravity shifted to the east.China has become an important growth pole of the world economy.However,at the critical stage of development of the socialist market economy,the economic benefit of domestic enterprises is relatively low.China has few world-famous enterprises.Obviously,our products lack of international competitiveness.Tracing the source,the concept of sustainable innovation of domestic enterprises is not in-depth.Innovation is characterized by having a longer cycle and a higher adjustment costs.In addition,Suddenly interrupted or continued innovation again will bring great losses to the enterprise.Therefore,maintaining the sustainability of corporate innovation is particularly important.Therefore,it is necessary to analyze the factors that affect the innovation of the enterprise.There are many factors that restrict the innovation of Chinese enterprises.Objectively,companies need a lot of money to innovate.At the same time,companies are still facing high risks.Therefore,many companies face financing constraints and R&D investment problems.Subjectively,as a direct decision maker of corporate affairs,executives have a significant impact on the strategic decision making of the firm.This fundamentally determines the direction of development and operation of the enterprise.Innovative activities are largely influenced by the company's managers.Based on the above analysis,this paper attempts to discuss the impact of corporate executive compensation on the innovation investment of enterprises under the premise of financing constraints.First of all,this paper gives a brief description of the current financing environment and R&D investment situation of listed companies in our country.Secondly,this paper analyzes the impact of executive compensation on innovation investment in financing,based on the financial surroundings.Finally,this paper quantitatively analyzes the relationship between executive compensation and R&D investment under the condition of financing constraints.This paper includes theoretical analysis and empirical analysis.Based on the panel data of China's small and medium-sized board companies,this paper constructs the measurement model.In order to test the relationship between financial constraints and executive compensation and corporate innovation,this paper uses descriptive statistics,correlation analysis,regression analysis and Hausman test.Through empirical research,we find that there is a significant positive correlation between executive compensation and corporate innovation investment under financing constraints.Therefore,this paper argues that in the economic environment where financing constraints are prevalent,enterprises should strengthen the design of executive compensation incentive mechanism.Raising the level of incentive incentive for executives can promote the R&D investment of small and medium-sized enterprises and enhance the innovation ability of enterprises.