| Since the establishment of the stock exchange market in China in the 1990 s,China has become the world’s largest IPO market.The IPO effect has a significant impact on the reduction of business performance of enterprises in China due to the late development of the financial market and the imperfect systems,which in turn affects the remuneration of executives of enterprises.This paper first analyzes the impact of IPO effect on executive compensation of listed companies by using principal-agent theory and corporate governance theory.Based on the mechanism analysis,hypotheses are proposed on the relationship between IPO effect and variables such as executive compensation,executive turnover pressure and corporate performance,and empirical analysis is conducted by combining data of A-share market from 2012 to 2022,and heterogeneity test is conducted based on the difference of enterprise nature.Finally,based on the results of the test,relevant suggestions are made for the government and listed companies.This paper uses a combination of theoretical analysis and empirical analysis on the effect of IPO effect on the incentive of listed executive compensation,and the results show that: first,under the IPO effect,executive compensation has a positive effect on corporate performance,IPO shock leads to an increase in the sensitivity of listed companies’ executive compensation to performance,and a decline in company performance under the IPO effect brings about a decrease in the stickiness of executive compensation and an increase in company executives’ turnover The regression results of the control variables show that,secondly,under the IPO effect,company revenue growth rate,company size,money capital holding,free cash flow,shareholding ratio of the first largest shareholder,two positions in one,and the proportion of independent directors all have positive effects on executive compensation,while asset and liability ratio and board size have negative effects on executive compensation under the IPO effect;thirdly,the IPO effect on There is no significant improvement in the stickiness of executive compensation of state-owned companies under the IPO effect,while the stickiness of executive compensation of private companies is positively improved under the IPO effect.Fourth,based on the empirical results,this paper proposes measures to reduce the impact of China’s IPO effect on corporate business performance from the perspective of the government and enterprises,arguing that China’s listed companies and the government need to improve the quality of proposed listed companies,vigorously promote the development of venture capital,It is believed that China’s listed companies and government need to improve the quality of proposed companies,vigorously promote the development of venture capital,improve capital market intermediaries,gradually improve stock market-related systems and expand corporate financing channels.The research of this paper tries to contribute in the following aspects: firstly,it proposes the mechanism of IPO effect on executive compensation incentive based on corporate governance theory and principal-agent theory;secondly,it points out the influence of IPO effect on executive severance incentive;thirdly,it proposes an executive compensation incentive system based on the combination of pay contract effectiveness and executive severance pressure,which is innovative in index construction. |
