Study On The Executive Compensation Based On The Internal Control Effectiveness

With China's internal control construction starting late,the relevant norms of the internal control have been introduced in recent years and more and more attention has been put on the construction of internal control.In the modern enterprise,the separation of management rights and ownership has produced the principal-agent relationship,the executive right of the enterprise has the right of the enterprise,the owner of the enterprise as the agent,in order to reduce the agency cost,it is necessary to take incentive measures to the executives,and the most direct and effective.The incentive is executive compensation.With the construction and implementation of internal control,as part of corporate governance,internal control can restrain the self-interest behavior of executives.Internal control is ultimately carried out by the people,then how to make executives can take the initiative in the internal implementation of internal control within the enterprise,the most direct way is to take into account the effectiveness of internal control to the executive compensation system,so that executives Not only for internal control in the enterprise to play an effective role in taking responsibility,but also with their own economic interests are closely related to encourage executives in the dual role of pressure and power to better implement the internal control system.Therefore,the study of the effectiveness of internal control on the specific impact of executive compensation,the development of executive compensation for listed companies is of great significance,but also the effective implementation of internal control has an important role in promoting.Based on the theory of principal-agent theory,salary incentive theory,information asymmetry theory and signal transmission theory,this paper analyzes the relationship between the internal control effectiveness and the executive compensation of listed companies in China selecting listed companies of 2015 in Shenzhen A shares stock.The company used the regression model to analyze the effect of internal control effectiveness on executive compensation,and draw the following conclusions: Firstly,internal control of business objectives and compliance objectives have a positive impact on executive compensation,and the impact is significant;Secondly,internal control financial reporting objectives and strategic objectives have a positive impact on executive compensation,but the impact is not great and the intensity of the explanation is not strong;Lastly,compared with non-state-owned enterprises,the positive correlation between the business objectives and compliance objectives of the internal control of state-owned enterprises and the executive compensation is more significant,and the financial reporting objectives and strategic objectives are in which type of enterprise and senior management Payments show no significant positive relationship.According to the conclusions drawn,combined with China's own business situation,given the executive compensation related to the development of policy recommendations.The purpose is to study the effectiveness of internal control over executive compensation has a clear impact on how to develop executive compensation,to promote executives to fulfill the important responsibilities of internal control construction,to ease the agency problem,so that internal control implemented,to achieve healthy and sustainable development of enterprises.