Empirical Study On Executives Salary Incentive And Corporate Performance Of IT Industry

The 21st century is the era of knowledge economy,and the talented person becomes the key for the enterprise development day by day. As the core decision-making strata, the high executives play an important role in enterprise's development. The high executives have alresdy become the object which the enterprise contests intensely. However, incentive problem of the high executives has become the hot issue for the theorists and the business community, and the basic principle of the problem is to be linked up with the enterprise performance.In recent years, China's information technology industry developed rapidly and has been widely used in economic and social fields. It played an important role in China's national economy and was an important source and power for the rapid growth. Information technology industry is a knowledge-intensive industry and human capital plays a central role in enterprise development, incentive for the high executives has more concern of society. Therefore, this paper carried out empirical study on incentive for the high executives and enterprise performance in information technology industry.Based on empirical study review of domestic and foreign incentive for the high executives and enterprise performance, using descriptive statistical analysis and hypothesis testing analysis, this paper studied the correlation between incentive for the high executives and enterprise performance in China's information technology industry. Selected listed companies in Shanghai and Shenzhen from 2006 to 2008 as the sample, taking the scale, the two level in one, local conditions into account, the paper first used descriptive statistical analysis on the status of incentive for high executives in the information technology industry, then constructed the linear regression model and tested the correlation between incentive for the high executives and enterprise performance using hypothesis testing analysis. The conclusions are as follows:From the descriptive statistics, in China's information technology industry, the executives'annual compensation in listed companies increases year by year, and the growth rate is speeding up, but the gap between the companies has also increased; The"zero-holding"phenomenon in listed companies is very common, the volume of executive Ownership is not high with low stakes and a downward trend. From the hypothesis testing, the executives'annual compensation in listed companies is significantly positively correlated with enterprise performance, and its relevance has the overall upward trend; The executive ownership is not significantly correlated with enterprise performance. To the scale groups, studies finds, the executives'annual compensation in the medium and large business is significantly positively correlated with enterprise performance, and the small business is not; Regardless of what scale, executive ownership and corporate performance have not significant correlation. Taking the two level in one into account, research shows, if the two level in one in listed companies, the executives'annual compensation and corporate performance have not significant correlation; if not, they have significantly positively correlation. And if the two level in one in listed companies, executive ownership and corporate performance have not significant correlation; if not, in 2006, ownership and corporate performance have significantly positively correlation. This shows that regardless of the executives'annual compensation or executive ownership, the listed companies of the two level not in one have better relevance than those of the two level in one. To the regional groups, studies finds that only in the eastern region the executives'annual compensation and enterprise performance have a significant positive correlation, but in the central and western regions, there is no significant correlation. Whatever the regions, executive ownership and enterprise performance are not significantly correlated.Based on the above research, we propose the following measures for the overall sample: (1) increase the level of executives'pay in information technology industry and improve its pay structure; (2) improve executives holding level in the information technology industry and emphasize the executives'long-term incentive. Finally considering various factors, we put forward different proposals for various conditions.