Compensation?Progress Of Marketization And Zombie Enterprises

In recent years,the growing problem of excess capacity has led to an oversupply of excess capacity beyond what is necessary to maintain healthy competition in the market,with serious economic consequences.Against this backdrop,in December 2015,Premier Li Keqiang proposed to deepen the reform of state-owned enterprises,promote supply side structural reform,and focus on eliminating Zombie enterprises to solve the problem of overcapacity.Since then,the term "Zombie Enterprise" gradually emerged in the line of sight.Zombie enterprises usually refer to those enterprises that are in poor economic condition but unable to repair.They occupy a large amount of resources in the market,but they cannot produce corresponding economic benefits,reduce the utilization rate of resources,and disrupt the normal market order Increased risk in the financial sector.Therefore,in the specific task of reform,the "go capacity" as the top priority,focus on speeding up the elimination of Zombie enterprises.Under this background,it is of great significance to explore the criterion of identification and the measures of clearance for Zombie enterprises to promote the development of market economy.At this stage,although the need to retire the Zombie Enterprise is gradually recognized,but in the Zombie Enterprise disposal process still met with great difficulties.The reason is that we haven't found a way to deal with Zombie enterprises in our country,and most of them are based on the experience of foreign countries.At present,most of the studies on Zombie enterprises are from the macro point of view.This paper is based on the impact of executive compensation on the formation of Zombie Enterprises Furthermore;the mechanism between them is analyzed according to the process of marketization.The test is divided into three steps: first,to test the relationship between Zombie firms and executive compensation;second,to test the relationship between Zombie firms and marketization process;third,to use marketization process as a moderating variable to examine the relationship between executive compensation and Zombie enterprises.According to the above research results,this paper based on the logical relationship between Zombie enterprises,executive compensation and marketization process,from the promotion of the effectiveness of executive incentives,improve the internal structure of governance and improve the external environment from the point of view of the Zombie EnterpriseRecommendations.This paper selects the a-share listed companies in Shanghai and Shenzhen stock markets from 2008 to 2016 as a sample,involving 13 industries.From the above-mentioned research,we can draw the following conclusions:(1)companies with lower executive compensation are more likely to become Zombie enterprises.(2)in the more market-oriented areas,the executive compensation has more significant inhibitory effect on the Zombie enterprises.Compared with the state-owned enterprises,the non-state-owned enterprises executive compensation has more significant inhibitory effect on the Zombie enterprises.According to the empirical conclusion,this paper puts forward the following suggestions: First,from the internal point of view,the enterprise should improve its own internal governance structure,the establishment of executive compensation and corporate performance-related assessment system.Secondly,from the perspective of market development,we should vigorously promote market-oriented reform to create a fair and orderly environment.Once more,from the Government Management Angle,the government should let the market mechanism display its due function,reduces to the enterprise stratification plane intervention.And deepening the reform of state-owned enterprises,in line with the needs of market development,so that enterprises face the competition market is fairer and more perfect.The innovation of this paper is:(1)firstly,this research expands the research perspective of the identification methods of Zombie enterprises.The existing research mainly focuses on the impact of bank's continuous lending,while this paper studies the identification of Zombie enterprises from the perspective of Internal Governance Environment and External Marketization Process It expands the research perspective of the existing research on the identification of Zombie enterprises.(2)It provides a new way for Zombie enterprises to retreat.Based on empirical data,this paper concludes that executive compensation as an important incentive mechanism has a significant impact on the revival and exit of Zombie enterprises,thus providing a new direction for the disposal of existing Zombie enterprises.(3)Innovation of research objects.Related Literature on existing Zombie enterprises has found that the proportion of Zombie enterprises in China's state-owned enterprises is higher than that of non-state-owned enterprises,because state-owned enterprises have more government intervention than non-state-owned enterprises there are also great differences in the way and degree of executive motivation.Therefore,this paper,according to the nature of the propertyrights to distinguish the sample,further explore the characteristics of state-owned Zombie enterprises,a certain reference value.