System Environment,External Fairness Of Executive Compensation And Corporate Performance

The continuous appearance of the executive sky-high compensation,the executive compensation viscous phenomenon occurring constantly,and the executive pay unfairness phenomenon in related industry,wh-ic h has become the social attention hot topic at the listed companies in our country.At the same time,those issue also has made the social publicdoubt about the rationality of executive compensation and executive compensation incentive effect.Although government all levels departments have issued a series of related salary limit policy to solve the problem of large income gap and unfair distribution,related limited terms mainly was in view of the pay gap between executives and employees,and did not make any specific limit about the executive pay fairness in the same industry and different enterprises.At present,the academic study of fairn-e ss of executive compensation mstly focuses on study about internalfai-rn ess of executive compensation,less on executive pay external equity.This may be closely related to the disclosure of executive compensation policy formulation and implementation,which started late.In recent years,China’s relevant departments gradually revised and perfected the disclosure policy on executive compensation of listed companies,whichalso provide the necessary data base for executive compensation of external equity in-centive.Based on the above situation,can’t help produce the following questions: external fairness of executive compensation will produce what kind of incentive effects of the enterprise? Solve the above problems,the paper selects the 2007-2014 Shanghai a-share manufacturing data of liste companies as the research samples,discussing effect of external fairness of executive compensation incentive mechanism.In addition,on the basis of resource dependence theory,enterprise as an open system,relying on the external environment contingency factors,its external fairness of executive compensation mechanism effect is inevitably restricted by the system environment.With the rapid development of our country’s economy,the enterprise property rights and marketization process is the most important two aspects in a system of our country enterprise environment,it will inevitably impact on incentive effects of external fairness of executive compensation.Therefore,this paper further analyzes influences of institutional environment onrelationship between external fairness of executive compensation and corporate performance,which discusses necessity of government administrative mediation executive pay.The result shows that relationship between external fairness of executive compensation and corporate performance is significantly positively.Further study demonstrates that equity structure and the marketization process have influence on the relationship between external fairness of ex-ecutive compensa ation and corporate performance.In compared with the non-state-owned,external fairness of executive compensation in state-owned enterprises have more significant positive effect on corporate performance;Compared with low marketization process sample group,the relations hip between external fairness of executive compensation and corporate performance is more closely in the high marketization process sample group.This study suggests that corporate should be combined with region marke tization process change to set reasonable compensation levels.Main innovation point of the study is to on the basis of redefining external fairness of executive compensation,discussing the external fair influence on enterprise performance;And then studied the effect of institutional environment on relationship between external fairness of executive compensation and corporate performance.