Empirical Research On Executicve Pay,Political Connections And Firm Performance

China is in an important period of opportunity for economic transformation and upgrading.It is necessary to optimize the economic structure,reconfigure resources,and increase the effective utilization of resources.During this period,senior talents are asked to make suggestions and investment operations.In the report of the Nineteenth Congress,Premier Li kment process.It is necessary to bring the world's elites together and strong China's power,thereby highlighting the important role of talent in economic developent and construction.In the same way,companies are seeking survival and development in a changing economic environment.Senior talent is also indispensable.Senior executives are high-level talents who have managerial ability and are at the core of the company's survival and development.Executives play an important role in the performance of the company.Although the economic system of our country plays decisive role,government has played an important role in the stability of the economic environment.Government can regulate the market through policy issuance.For example,when the industrial structure is adjusted,it will support emerging industries and give tax incentives to the environmental protection industry.Luoyang Glass Co.Ltd.on December 29,received a government grant of RMB 100 million for ultra-white light thermal material project.In the same year,Chong qing Iron and Steel Co.Ltd.got a government energy saving and environmental protection subsidy of RMB47.05 million This shows that the government has a positive role in the development of the firm.The relationship between the firm and the government has played a role in the operation of the enterprise.This article uses the one type of relationship between the company and the government—the relationship between senior management and government to study it.Although scholars usually start with the factors of the impact of executive compensation,but do not take into account the impact of political associations on salary,so this article executives pay this path to study the impact of political association on corporate performance.This paper uses literature review and theoretical analysis to find that for relevant issues of executive compensation incentives,we ignore the unique social and political environment in China.Our country is a socialist country.The influence and authority of the government infiltrate all aspects of economic life.To study the issue of salary incentives for listed companies in China,we must consider the impact of political connections.According to the level,the political association is divided into five levels:national level,provincial level,municipal level,county level,and district level.Values one,two,three,four,five,are assigned to five levels.This article selected the companies listed on the Shanghai Stock Exchange A-share market from 2013 to 2016 as research samples,and used correlation analysis and multiple regression analysis to analyze the impact of executive compensation and political association on corporate performance.The empirical results show that: In state-owned and non-state-owned enterprises,pay of the executive plays a catalytic role in corporate performance and is consistent with the pay incentive theory.In state-owned enterprises,the higher the degree of political association of senior executives,the relatively lower the compensation for senior executives,but not lower than the salaries of civil servants in the same administrative positions.In enterprises non-state-owned,the higher the degree of political association of senior executives,the higher the compensation to executives,and the political association of senior executives is the scarcity of political resources.This shows that political associations have different mechanisms of action in different natures.The combined effect executive compensation and political connections can improve business performance.However,the strength of non-state-owned enterprises is greater than that of state-owned enterprises,which is mainly related to the different performance of executive compensation and political link in the two types of enterprises.This article provides a way for political associations to influence corporate performance through the role of executive pay.This enriches the factors affecting executive compensation and makes factor analysis more overall.Provide a perspective for the company,consider the influence of executives' political association on the value of the company in the process of salary incentives,and at the same time provide constructive suggestions for enriching and perfecting the company's salary incentive system.