The Design On Salary Incentive Mechanism Of Pingjiang Rural Commercial Bank

At present, along with the tendency of economic internationalization andfinancial globalization, China’s financial market accelerating the pace of opening tothe outside world. The environment of our domestic commercial bank is experiencingan unprecedented severe changes, competition between banks is pretty fierce. Ruralcommercial bank developed rapidly as the shareholding reform of rural creditcooperatives, but increasingly fierce industry competition makes it the key to thesuccess of bank reform to establish a perfect salary incentive mechanism.At the same time, information asymmetry and incomplete contract caused by theseparation of ownership and operation will inevitably lead to corporate governanceissues. In the principal-agent model, agents always pursue their own maximuminterest, and not be completely in accordance with the interests of the principal aims,even using the rights granted by the consignor to increase their own benefits on thecost of damage the interests of the principal’s. Therefore, corporate governance issuesdue to the incomplete internal supervision mechanism and abuse of executive powercaused serious influence to the bank management.So, to design a set of scientific and reasonable salary incentive system is the keyto the governance of commercial bank. Improving the corporate governance structureis to form effective incentive and restraint for internal staff. Incentive and constraintbelongs to two aspects of one problem, its goal is to develop effective control withtheir employees. Generally, the motivation is enforced through the salary system.Facts prove that, the salary system based on performance appraisal can effectivelyarouse employees’ work enthusiasm, it has extremely important influence andimmeasurable positive effect for the internal management to an enterprise.Based on the incentive theory, this paper aims to study about the present situationof rural commercial bank’s incentive system of our country, to reveal the defects ofsalary incentive system. On the basis of relatively mature incentive theory, weabsorbing successful experience from western banks, and giving improvementsuggestions on the salary incentive mechanism for our banking industry. In this article,we try to improve and refactor the existing salary incentive mechanism of PingjiangRural Commercial Bank, and to build performance appraisal and remunerationincentive mechanism, which based on the balanced scorecard, so as to promote thebusiness efficiency and competitiveness, and finally make the bank realize theeffective and steady development.