Executive Compensation Stickiness,Analyst Tracking And Corporate Investment Efficiency

Investment is one of the “three driving carriages” of economic development,and improving investment efficiency is of great significance regardless of the development of enterprises,economic growth.As the “total helmsman” of business management,executives has a direct impact on enterprises’ investment decisions.In the entrusted agent relationship,in order to promote the investment choice of executives,it is the key to developing a valid salary incentive contract.The traditional salary contract believes that the performance salary mechanism of executive salary and the company’s performance is a valid institutional arrangement.However,a large number of studies pointed out that my country’s senior compensation has a “viscous” characteristic.The asymmetry of this compensation performance has deviated from the original intention of the best compensation contract,which weakens the effectiveness of compensation incentives,and it is likely to harm the investment efficiency of enterprises.Therefore,the research on the efficiency of executives on the investment efficiency of executives and how to improve corporate investment efficiency cannot be ignored.As an important external governance mechanism,securities analysts are known as information “bridges” in the capital market.With their professional theoretical knowledge and practical skills,they should be able to alleviate information asymmetry and principal-agent problems,and improve compensation contracts.Effectiveness and standardize management’s business decisions.However,my country’s securities consulting industry has a low threshold for employment,imperfect regulatory system construction,uneven levels of practitioners,and the existence of interests between buyers and sellers,making it difficult to guarantee the function of analysts in my country’s capital market.For the purpose of maintaining information channels,analysts with related interests may turn a blind eye to the profit-seeking behavior of executives,or even “collusion” with executives,which seriously affects the effect of compensation incentives.It can be seen that whether securities analysts play the role of “white wizards” or “black wizards” in my country’s capital market is still up for debate.In this context,this paper incorporates analyst tracking into the relationship between executive compensation stickiness and corporate investment efficiency is necessary.Based on information asymmetry theory,principal-agent theory,optimal compensation contract theory and efficient market hypothesis,this paper tests the relationship between executive compensation stickiness,analyst tracking and corporate investment efficiency through empirical regression.The study found that:(1)Executive compensation stickiness has a negative impact on corporate investment efficiency;(2)Analyst tracking strengthens the negative impact of executive compensation stickiness on corporate investment efficiency;(3)Further grouping regression results show that compared with manufacturing companies and those in the intense for companies in product market competition,analysts tracking to the negative impact of strengthening executive compensation stickiness on corporate investment efficiency,only non-manufacturing companies and companies with low product market competition.This paper enrichs the research of high-managed compensation and corporate investment efficiency.Develop salary incentives and relevant regulatory authorities to improve the supervision mechanism and interest guarantee system for securities analysts,promote investment efficiency and improve the continued healthy development of my country’s economy has a certain Enlightenment.