Research On The Impact Of Executive Compensation On Financial Performance Of Listed Companies In Advanced Manufacturing Industry

Focusing on the strategic goal of becoming a strong manufacturing nation,our country is currently implementing the "made in China 2025" plan,which is the first10-year program of action to implement the plan.In his report to the 19 th national congress of the communist party of China(CPC),general secretary xi jinping also clearly pointed out the important position of advanced manufacturing industry in China's economic system and put forward the economic strategy of focusing on the development of advanced manufacturing industry.These national strategies can fully reflect the important position of advanced manufacturing industry in China's economic system.To develop advanced manufacturing industry,scientific management mode is the top priority.As the core of enterprise management decisions,senior executives make economic decisions that will affect the financial performance of enterprises and play a decisive role in the development of enterprises.It is very important for enterprises and the development of the whole industry to make scientific incentive plans to improve the working enthusiasm of senior executives and maximize the financial performance of enterprises.Therefore,this paper studies the influence of executive compensation on financial performance of listed companies in advanced manufacturing industry.Firstly,by reading a large number of relevant literature,the research status at home and abroad is analyzed,the experience and lessons of previous studies are learned,the research hypothesis of this paper is proposed according to the status of the relationship between the two,and the research model is constructed for empirical analysis.In this paper,data from 150 listed companies from 2014 to 20185 were selected as research samples,and the impact of executive compensation on financial performance of listed companies in advanced manufacturing industry was studiedmainly by means of regression analysis.The financial indicators of enterprise profitability,operating ability and debt paying ability were selected,and the comprehensive performance indicators were constructed by factor analysis,and the influence of executive compensation on financial performance was analyzed from the aspects of monetary compensation and shareholding ratio of executives.Research results show that the executive compensation and the "inverted U" relationship between financial performance,whether executives monetary compensation or executives shareholding can by means of adding to motivate executives,encourage excessive executive pay increase will have the opposite effect on financial performance,"inverted U" curve of the inflection point will be affected by the selected control variables,the enterprise should be according to the actual situation to look for positive correlation interval for their own development situation.The conclusion of this paper is that the listed companies of advanced manufacturing industry should reasonably determine the proportion of executive compensation and balance the relationship between executive compensation and financial performance.Enterprises should control the dimensions of incentives according to the actual situation,and strive to maximize the positive energy of senior executives in the development of enterprises.