Research On The Effect Of Executive Incentives On Corporate Environmental Performance

The 19th National Congress of the Communist Party of China put forward the proposal of "Speeding up reform of the system for developing an ecological civilization,and building a beautiful China".This requires that corporations need to pay more attention to environmental protection in today's increasingly severe environmental problems.And the effect of environmental protection is reflected to the level of corporate environmental performance to a certain extent.Therefore,as one of the important contents of environmental management accounting,the discussion and research of corporate environmental performance is becoming more and more fully.This requires we need to pay more attention to the construction of corporate environmental performance system,especially in heavy pollution of listed companies.At the same time,corporate environmental performance will be an important basis for judging whether the corporation fulfills its social responsibilities and actively undertakes environmental responsibility.As the decision-maker and executor of corporate environmental policy,the decision of the executive largely determines what kind of the environmental strategy corporation choose,which affects the corporate environmental performance.Principal-agent theory believes that the incentive to executives will reduce the behavior of executives,so that executives can make environmental strategies from the long-term development of corporation.Therefore,what is the effect of executive incentives on corporate environmental performance in heavy pollution of listed companies?What are the differences in the effect of executive compensation incentives and executive equity incentives on corporate environmental performance?And what role will ownership nature play in this relationship?Clarifying the relationship between them will help to establish effective executive incentive system,to improve corporate environmental performance management system,and to promote long-term development of corporation.This paper is divided into five parts:the first part is introduces the research background,significant,ideas,and the methods of the research.And summarizes the research findings related to corporate environmental performance at home and abroad.The second part we define the concept and content of the research object,and analyze the related theoretical basis of executive incentive and corporate environmental performance.The third part focuses on the current situation of corporate environmental performance and executive incentive in heavy pollution of listed companies.Then puts forward the research hypothesis based on analysis.The fourth part is the empirical research part of this paper.This paper uses the multiple regression analysis to test the research hypothesis.The fifth part is the conclusions and policy recommendations,and puts forward the research prospect.The research found that:(1)the executive compensation incentive has a upside-down U-shaped relation with corporate environmental performance in heavy pollution of listed companies.(2)when under the different level of the incentive of executive compensation,the effect of compensation incentive on corporate environment performance of state-owned enterprises is different from non-state-owned enterprises.(3)the executive equity incentive has a positive relationship with corporate environmental performance in heavy pollution of listed companies,but it has not passed the significance test.The possible innovation of this paper is that instead of using the more subjective score assignment method,the corporate environmental performance in heavy pollution industry listed companies build on the ecological benefit evaluation criteria of WBCSD.So it's more accurate and objective to considering financial indicators and environmental indicators at the same time.The conclusions are more targeted with the direct research of executive incentive on corporate environmental performance.