Study On The Influence Of Executive Compensation On The Enterprise Performance With The Capital Structure As Mediating Variable

In modern enterprises,due to the separation of property right from managerial right,executives shoulder the major responsibilities of strategic decision-making and implementation instead of owners.So they are the core and such important human capital in the development of enterprises and their salaries naturally become an important part of corporate governance.The existing research mostly concentrate on the relationship between executive compensation and enterprise performance,only according to the performance to formulate compensation,however,they are not the absolute proportion relationship.This paper study the influence mechanism of the executive compensation on enterprise performance from the capital structure view,at the same time,take the capital structure as intermediary variable,on top of that do the deeply research and discuss inner relationship among them,which enriches the research between executive compensation and performance.This paper also suggests us to take capital structure into consideration when formulating compensation,which makes a lot of sense for playing a role of reasonable salary incentive and perfecting corporate governance.This paper firstly reviews the related literatures from home and abroad,puts forward the research hypotheses based on related theories.After that,it selects related financial data on stock market of Shanghai and Shenzhen from 2012 to 2015 of Chinese manufacturing-listed companies,makes descriptive statistics,applies the SPSS software to establish the regression model and makes empirical analysis as well as robustness test.Finally,the research shows that :(1)Enterprises' capital structure and the executive compensation are significantly positive correlation;(2)Enterprises' capital structure and its performance are insignificant positive correlation in line with the MM correction model;(3)Executive compensation and enterprises' performance are insignificant positive correlation afer taking the capital structure into consideration as a intermediary variable,it can make a partly intermediary effect.According to the research conclusion,the paper mainly give following suggestions: we should speed up the reform of manufacturing,perfect the executive compensation incentive system;strengthen the executive compensation disclosure system;pay more attention to the long-term incentive and evaluation,at the same time design a set of more scientific rules to ensure the optimization of capital struture and increase the compatibility between executive compensation and enterprise performance.