The Process Of Marketization, Media Report And Executive Compensation

In recent years, corporate profits decline in large numbers of companies because of the impact of the global economic crisis, but the growth in executive compensation is presented a trend of deviating from the economic development and corporate performance. As one of the important information communication channels, media reports the development trend and causes of the listed companies' executive compensation timely. It has caused the social from all walks of life to pay attention to the problem about executive compensation. In this context, it explores whether the media plays the supervision function or go vernance function, and whether there is a difference about media impacting on executive compensation under the condition of different property rights or the marketization process.Simultaneous equation model is established using A-share listed companies from year 2008 to 2013 as sample data. It studies influences between positive media report, negative media report and the executive compensation of listed companies in our country from the angle of external governance mechanism. And it further studies impact of the negative media report on executive compensation of listed companies in our country under the different process of marketizat ion. Firstly, media report can reduce the degree of information asymmetry between principal and agent, supervise executive compensation levels of the listed company, and prompt the company information more transparent. Secondly, positive media report can raise the le vel of executive compensation in listed companies. Thirdly, compensation for executives of listed companies can be greatly reduced by negative media report, thus playing a role of corporate governance. Compared with the state-owned listed companies, negative media reports supervise corporate governance and reduce the level of the executive compensation of listed companies more pronounced in non-state-owned listed companies. Fourthly, in the lower process of marketization, executive compensation can be effected by negative media reports more apparently. There is a substitution effect between process of marketization an d negative media reports.According to the results of theoretical analysis and empirical test, we should value the role of corporate governance of media reports and create a good external environment for media coverage. At the same time, the media also should improve their professional ethics accomplishment and strengthen self-discipline management. Finally, we should improve and perfect the system of examination and disclosure of executive compensation to improve the executive compensation system of listed companies.