An Empirical Study On The Relevance Of Perks And Corporate Performance Under The Influence Of Media Monitoring

The separation of ownership and management rights leads to the agency costs, and management of the Company takes advantage of the right in hands to gain private benefits of control, which may harm the interests of shareholders. In order to control the management of private benefits of control, and protect the interests of shareholders, scholars have designed compensation contracts, internal governance, and legal norms from many aspects, and have done extensive research. Perk, as a kind of agency costs, has caused interest of academics and have been studied by corporate governance scholars. There are many efforts to study perks taken from the aspect of incentive compensation management, internal control and other aspects of research, and there is much attention paid to the relationship between media monitoring and agency costs. But there is no profound research on the relationship between media monitoring and perks. This paper attempts to research on perks from the point of media monitoring which is a kind of external governance mechanism.Since the content of perks is complex, it is difficult to do the research on perks. Apart from the difficulties brought by the imperfect disclosure system, perks of management is different from the general management’s behavior of wasting company resources. Part of perks is used to maintain normal production and operation of the company, and only the excessive part is the embodiment of the agency cost. The mix of its reasonable parts and excessive also increases the difficulty to solve the problem of management perks. From the point of management compensation, when the dominant compensation, that is monetary compensation and stocks, is insufficient incentive, perks of management can also serve as a recessive compensation. Perks, as a recessive compensation, may help to improve management’s status in the company and to promote manager’s job enthusiasm. Especially because of the compensation control of state-owned enterprises in China, this phenomenon is evident in the state-owned enterprises in our country. From the perspective of perks’regulation cost, the confidentiality of perks and difficulty to differentiate the reasonable parts and excessive, have increased the difficulty to perk regulation. If the regulation cost is much more than the negative effects of perks itself, then the regulation of perks does not make sense.At first, this paper summarizes the predecessors’ research on perks and media supervision, and from the aspect of entrust-agent theory, reputation mechanism and the theory of marginal utility, the relationship between perks and corporate performance is researched. This article selects the media monitoring data from2009to2013, perks data, the data from2010to2013. Descriptive statistics, correlation analysis and regression analysis have been experimented, to test the impact of media supervision on perks, the relationship between perks and corporate performance, and the relationship between perks and corporate performance under the influence of the media supervision.This paper is divided into six parts:the first part is introduction, mainly elaborating significance of the topic, the research background, research contents, research methods and innovation points; The second part is the literature review, attempting to summarize literature on perks and media supervision at home and abroad; The third part defines the definition of key concepts, and introduces the main theory at the same time put forward in this paper, and then come up with three hypotheses; The fourth part is the research design, including sample selection, data sources, variable design and model design; The fifth part is the empirical test and analysis, and this part mainly includes the samples of descriptive statistics and tests three hypotheses proposed in this paper; The sixth part is empirical conclusions and puts forward the corresponding policy recommendations.In this paper, the study finds that media supervision can effectively restrain the addition of perk. The inhibition effect on state-owned and non-state-owned companies has been demonstrated, and the inhibition effect on non-state-owned is better than the state-owned companies. The relationship between perks and firm performance is inverted u-shaped and the inverted U-shaped relationship exists in the state-owned and non-state-owned companies. At the same time, we notice that perks’effect on company’s performance of state-owned companies is worse than that of non-state-owned. At the end of the paper, the U-shaped relationship between perks and corporate performance under the effect of media doesn’t exist any longer, and perks under the effect of media has positive effect on corporate performance.