The Research On Commercial Banks Executive Compensation Incentive Mechanism Of Our Country

The banking industry has always been the pillar industry in China.Under the environment of economic globalization,interest rate marketization and the rise of Internet finance,the banking industry is faced with unprecedented challenges.The high salary of bank executives has also been a common concern of all sectors of society.Chinese government developed a series of guiding opinions on executive remuneration of central enterprises,which had a great impact on China's state-owned commercial bank executives.Therefore,now to study China's commercial banks executive compensation incentive mechanism has important significance.First of all,on the basis of relevant theories,this paper collects data of executive compensation and performance indicators of listed commercial banks,including 16 listed commercial banks in China.We studied the disclosure system of salary system and wage report,and found out that China's commercial banks had not disclosed the specific composition and sources of executive compensation,and many of the data was also missing.Besides,long-term incentive incentives was lack.In addition,through the inter-bank comparison,we found that the inter-bank executive pay disparity,and the executive pay did not reflect the profitability of banks.At the same time,we also found that the executives pay and risk were not closely linked.Secondly,based on the traditional principal-agent model,this paper established a dynamic multitasking incentive incentive model for commercial banks in China.Through the analysis of the model results,we found that executives made decisions must control the risk;in the second phase of the contract,the comprehensive performance level needs to be compared with the average comprehensive performance level of the banking industry,which can balance the fairness of the executive pay of the banking industry and improve the inequality of the current executive pay;the bank executives with high comprehensive performance will receive extra of the incentives,and the research shows that this part of the additional incentives for executives like a similar long-term incentive effect.In addition,we also found that the specific incentive for each task was negatively correlated with the risk aversion degree of the executive,but positively correlated with output volatility and the difficulty of the task,and so on.Finally,the paper summarized the research contents and put forward corresponding policy recommendations.At the same time,it indicated the next step which could be further studied.