Research On The External Fairness Of Executive Compensation And Corporate Investment Efficiency Of Private Listed Companies

Effective investment activities are crucial for enterprises to optimize resource allocation and improve corporate performance.However,the inefficient investment behaviors are seriously exist in China's listed companies.As the main operator of enterprise,executives' decisions directly affect the investment efficiency of the enterprise.How to alleviate the principal-agent problem in modern enterprises and better motivate executives through compensation has always been the focus of theoretical research and management practice.Regardless of the publicly disclosed executive compensation data of listed companies or the results of academic research,external gaps in executive compensation are very common,and social comparisons based on such gaps are also widespread.There're studies stated that the external fairness of executive compensation will affect the financial performance of the company.In view of this,it is of profound theoretical and practical value to examine the relationship between the external fairness of executive compensation and corporate investment efficiency as well as its impact mechanism.Focusing on the executives of private enterprises that are more sensitive to monetary compensation,this study explores the current external equity of executive compensation of private listed companies in China and its relationship with corporate investment efficiency,and examines the possible regulatory effects of executive equity incentives and financial background on the relationship.Based on the social comparison theory,equity theory,principal-agent theory and imprinting theory,this study propose related hypotheses,use a variety of statistical analysis methods.The following conclusions are drawn: First,the external fairness of the executive compensation of private listed companies is negatively related to the corporate investment efficiency,indicating that an appropriate industry compensation gap can lead to more rational investment behavior and higher corporate investment efficiency.Second,equity incentive has a positive moderating effect on the relationship between the external fairness of executive compensation and corporate investment efficiency,Third,the financial background of executives has a positive moderating effect on the relationship between the external fairness of executive compensation and the efficiency of corporate investment.