Research On The Impact Of Executive Compensation Gap On R&D Investment In Family Enterprises

In China,family business has become an important part of the economy.However,despite the rapid establishment of family enterprises in China,their life span is relatively short.The survey shows that although family enterprises have strong willingness to innovate,they generally invest less in R&D.therefore,in order to achieve sustainable development of family enterprises,the key is to increase the R&D investment to improve the innovation ability of enterprises.Previous studies have shown that enterprise innovation will be affected by the pay gap between managers,while the kinship in family business directly affects the attitude of managers towards pay gap,and then affects the R&D investment decision-making of enterprises.Based on this,this paper divides CEO and VP level executives into family members and non family members according to their kinship,and studies the impact of internal vertical pay gap between different types of CEO and VP level executives on R&D investment and its mechanism.Based on the statistical data of family enterprises listed in Shanghai and Shenzhen stock markets from 2007 to 2018,this paper uses empirical analysis method to study the impact of pay gap between CEO and VP level executives on R&D investment,further subdivides CEO and VP level executives according to whether they are family members,and explores the pay gap between CEO and VP level executives with different kinship status Impact on R&D investment.The results show that Firstly,the internal vertical pay gap between CEO and VP executives is negatively correlated with R&D investment,which conforms to the equity theory.Secondly,the internal vertical pay gap between family member CEO and family member VP level executives has no significant impact on R&D investment,while the internal vertical pay gap between family member CEO and non family member VP level executives is negatively related to R&D investment,which conforms to the equity theory.Thirdly,the internal vertical pay gap between non family member CEO and family member VP level executives has no significant impact on R&D investment There is no significant impact on the entry,but the internal vertical pay gap between non family CEO and non family VP executives is negatively correlated with R&D investment,which is in line with the equity theory.In conclusion,the impact of pay gap between CEO and VP level executives on R&D investment is related to whether VP level executives are family members.When VP level executives are family members,whether CEO is family members or not,the pay gap has no significant impact on R&D investment.When VP level executives are non family members,whether CEO is family members or not,the gap between the two will affect R&D investment The R&D investment of enterprises has a significant negative impact.Through empirical research,this paper obtains the influence of the salary gap of senior managers in family enterprises on the R&D investment,which provides a new perspective for the research of the influencing factors of the R&D investment in family enterprises,enriches the research on the salary gap in China,provides an effective reference for the establishment of the compensation mechanism for the management of family enterprises,and provides a new way for enterprises to increase the R&D investment,which is beneficial to the family Enterprises promote R&D and improve the level of corporate governance by optimizing the executive compensation system.