An Empirical Study On The Share-based Compensation Incentives For Senior Executives Of State-owned Enterprise

Since 2015,the central government has gradually reformed the compensation structure of SOE executives at all levels and in all fields.After the reform,the remuneration of senior executives in state-owned enterprises is composed of three parts.The basic annual salary is the fixed income matching the position,and the performance annual salary and tenure incentive income are determined by the SASAC based on the annual performance and tenure performance assessment of senior executives,accounting for a relatively large proportion,which can be called incentive compensation and has the nature of sharing contract.The design of the compensation sharing contract enables the executives of state-owned enterprises to share the operating results of the enterprise,so as to achieve a more reasonable link between the executive compensation and the output performance created.It can motivate the enthusiasm and creativity of the executives to work hard to a certain extent,and improve the operating performance of state-owned enterprises.However,few scholars explore the incentive effect of the compensation of SOE executives from the perspective of sharing the compensation contract.Based on this,this thesis uses theoretical analysis and micro data to empirically test the incentive effect of different types of executive compensation sharing in state-owned enterprises,and compares and analyzes the heterogeneity of compensation sharing incentive in state-owned enterprises with different functional categories and different levels of control.It is beneficial to enrich the relevant research in the field of compensation incentive contract design of SOE executives and to optimize the compensation incentive contract design of different types of SOE executives,which has certain theoretical and practical significance.This thesis analyzes the incentive effect of executive share compensation in state-owned enterprises in China from theoretical and empirical perspectives,and proposes corresponding countermeasures and suggestions based on the research conclusions.Firstly,on the basis of the share tenancy theory,the thesis relaxes the assumption of factor homogeneity and constructs the principal-agent contract theoretical model of state-owned enterprises,trying to explain that under the situation of human capital heterogeneity of SOEs’ executives,the share compensation contract can effectively motivate the SOEs’ executives,which becomes the theoretical logic of win-win equilibrium result of both sides.Secondly,through theoretical analysis and deduction,this thesis explores whether the incentive effect of the share compensation contract for SOEs’ executives will have different results due to the types of executives,SOEs’ functional categories and hierarchical control,and then puts forward a hypothesis proposition to provide theoretical guidance for the empirical test below.Then,selecting the panel data of A-share state-owned listed companies in Shanghai and Shenzhen from 2006 to 2020,using fixed effect model and group regression test to empirically investigate the share compensation incentive situation of different kinds of executive in state-owned enterprises,and comparatively analyze the heterogeneity of state-owned enterprises with different functional category and level control in the share compensation incentive.Finally,it is found that the share compensation incentive of different types of SOEs’ executives is significantly positive,but there is no significant difference between the chairman and general manager.State-owned enterprises with different functional categories and different levels of control have significant differences in share compensation incentive.The share compensation incentive degree of executives in competitive SOEs’ enterprises is significantly higher than that of non-competitive state-owned enterprises,and the share compensation incentive degree of local state-owned enterprises is significantly higher than that of central state-owned enterprises.According to the theoretical deduction and empirical analysis results,this thesis proposes the following countermeasures and suggestions: First,we should adhere to the classification and grading management,and establish the differentiated share compensation incentive contract suitable to the nature of the enterprise.Second,we should establish and improve the internal and external restraint system to regulate the behavior choices of SOEs’ enterprises.Thus,a complete incentive and restraint system is formed,which is expected to provide a useful reference for optimizing the incentive contract design of executive compensation in state-owned enterprises in China.