The Capability Of Key Subordinate Executives And Corporate Performance

In recent years,CFO,COO and other key subordinate executives in the large enterprises gradually become the highest planners,decision makers and organizers of the whole operation of enterprises.The important of the key subordinate executives have aroused widespread concern.A large number of existing academic literature about corporate executives,mainly around the CEO,chairman or general manager.But the study specifically around CFO,COO and other key subordinate executives is rarer.Based on the important role of the key subord:inate executives in corporate governance,this paper focuses on the key subordinate executives and put forward the following issues:Are the key subordinate executives effective in improving corporate performance?Whether they can inhibit the CEO power,making the company's performance will not be reduced because of CEO larger power?When CEO incentives intensity is weak,whether the key subordinate executives can offset the CEO due to lack of incentives,work hard to reduce the company's performance to bring a negative impact?Based on the ability of the key subordinate executives,this paper makes a theoretical analysis and empirical research on the above problems from the perspective of CEO power and CEO motivation by using data from Chinese listed companies.In this paper,we regard the key subordinate executive ability as a research object,for the filed of research to provide a new perspective.First of all,this paper from the definition of the relevant concepts,and combined with the Professional Division of Labor Theory,Team Production Theory,Principal-Agent Theory,Management Talent Specificity Theory and Upper Echelon Theory.Then through descript the role of the key subordinate executives in the management decision-making mechanism,system analyze the role of the key subordinate executives.Secondly,according to the previous theoretical analysis,put forward the corresponding research hypothesis,which including the relationship between the key subordinate executives' ability and the performance of the company,and the relationship of different CEO' power and the CEO' motivational intensity to the key subordinate executives' ability and the performance of the company.Select the data of Chinese listed companies from 2009 to 2015 as the research samples,use the relevant measurement software for empirical analysis,and then draw the conclusions of the study.Finally,according to the empirical results,we put forward the countermeasures and suggestions,expound the shortcomings of this paper,and point out the direction of future research.This paper finds that:(1)the strong of the key subordinate executives,the more can improve the corporate performance.(2)The greater the CEO's power,the lower the company's performance.And the key subordinate executives' strong ability can inhibt the negative impact of CEO power over the company's performance.(3)The lower the incentive intensity for CEOs,the less the company's performance.The key subordinate executives can mitigate the negative impact of lower CEO incentives on corporate performance.In this paper,the research results show the key subordinate executives is one of the key factors affecting company performance;the strong ability of the key subordinate executives can make up the company's performance for the CEO power or CEO incentive.On this basis,this paper put forward the following aspects in order to optimize the management structure,improve the company's performance:(1)establish a diversified structure of executives;(2)improve the company's bottom-up supervision system;(3)create a suitable environment for the key subordinate executives.