The Study On The Relationship Between Executive Compensation And Enterprise Performance In Listed Companies Of Power Generation Industry

In the general environment of my country’s economic transformation and upgrading,how to improve enterprise performance has become more and more attention.More and more attention is paid to improving business performance.Identifying a rational executive compensation mechanism and the correlation between executive compensation and company performance are important issues for the analysis of modern researchers.As the economy evolved,new business models such as Proxy agent have emerged.This model allows shareholders to entrust an agent to manage and operate the company.But this model also has a negative effect,it can create conflicts of interest between executives and shareholders.The executive compensation mechanism can play a stimulating and restrictive role and can resolve conflicts between executives and shareholders of the company.The power generation industry is directly linked to the country’s competitiveness and is inextricably linked to economic development and people’s basic lives.The executive compensation mechanism is of great importance to corporate governance,and its rationality and reluctance have a direct impact on the development of the company.It is important for the future development of listed companies in power generation industry to set up a rational compensation mechanism.This contract collects financial data from publicly traded companies of listed companies in power generation industry from 2012 to 2018 based on research results and existing theories.After reviewing the data,the last 24 listed companies of listed companies in power generation industry will be decided.Combining data analysis,the correlation hypothesis of executive compensation and corporate performance has been put forward.After using EXCEL and SPSS to perform descriptive statistics and correlation tests on the data,we built a model to analyze multiple regressions to obtain the results of executive compensation and performance regression tests.The variable design uses financial metrics and key component analysis to leverage four aspects of business performance:debt settlement,profitability,operations,and business development skills.In choosing the explanatory variables,executive compensation,depending on the availability of data and the borrowings of previous studies,is represented by executive monetary compensation,the executive compensation gap,and executive involvement percentage.The choice of control variables takes into account the relevant variables that affect the results and,when combined with the relevant literature,performs an analysis on two levels that affect company performance and behavior:company size,concentration of stocks and independence.The conclusions of this agreement are as follows:(1)The financial compensation of the directors of publicly traded companies of listed companies in power generation industry can promote the performance of companies.(2)There is no significant correlation between the salary gap of executives of listed companies in power generation industry and corporate performance;(3)The ratio of the shares of owners of listed companies in power generation industry can promote business development.Based on the above conclusions,this document proposes the design of the executive compensation system from four points of view:improving the annual executive performance compensation system,standardizing performance evaluation indicators,introducing long-term incentive mechanisms and strengthening restraint and supervision.It is expected that this will be a benchmark for improving the company’s performance.