A Study On The Pay Incentives Of State-owned Enterprises Executive Based On The Perspective On Social Performance

Enterprise executive pay is the current domestic and international concern the hotspot and difficulty."Price high paid" events continue to impact the bottom line of public morality. The international financial crisis, the United States, Britain, France, Germany and other countries adopted a series of "pay limit" measures,and to regulate executive compensation of state-owned enterprises is the focus issues of "two sessions" in2010. Enterprises especially state-owned enterprises’ executives pay and the resulting social problems have aroused great concern. Its special status of state-owned enterprises in the national economy determines it will take on greater social responsibility, but many state-owned enterprises blind pursuit to maximize the the interests of the shareholders, and its goal is often the opposite of social responsibility.With the division of social enterprise socialized, the dependencies between members of society gradually increase. Symbiotic relationship between enterprise and stakeholders is increasingly prominent. The awareness of corporate citizenship is stronger, so that corporate social performance attracted widespread attention. The existing literatures have explained the important role of corporate social performance in the survival and development from financial performance, competitive advantage, and strategic perspective. Stakeholder theory suggests that corporate social responsibility only to the strategic level will bring competitive advantage. Strategic direction of corporate social performance depends largely on the promotion and decision-making of executives. How to improve executive compensation incentives to encourage executives promote corporate social performance, integrate corporate social performance into the company’s core strategic level, we should think deeply.Most of the existing literatures focus on the relationship between corporate governance, executive compensation and financial performance. Literature on business executive compensation literature based on the perspective of social performance is less, theory is not mature.The existing empirical literature have not yet formed the same conclusion for several selected variables, samples and research methods; and research background of the literature developed mainly in North America.It is lack of sample rooted in the emerging economies, therefore, we must study t he interaction between corporate executive pay and social performance in depth.This paper brought corporate social performance into the contracting process of executive pay, built up a model of executive pay and corporate social performance based on transaction costs, agency theory and stakeholder theory, incentive theory, human capital theory and strategic compensation theory. To test hypotheses of the model, data were collected from137in the state-owned listed company, using factor analysis, regression analysis. Findings were as follows:the annual salary has a positive association with strong corporate social performance and total corporate social performance has a negative correlation with weak corporate social performance; Executive Ownership has no significant relationship with corporate social performance. According to the empirical research results, this paper build executive pay decision-making mechanism involved more other stakeholders,and focus on the linkage of corperate financial performance and social performance,and provide the support to perfect our country state-owned enterprise executive compensation incentive.