Government controlling ownership and CEO compensation incentives: evidence from China

被引：6

作者：

Hui, Zhiyang ^{[1
]}

Fang, Hongyan ^{[2
]}

机构：

[1] Chongqing Technol & Business Univ, Sch Finance, Chongqing, Peoples R China

[2] Shanghai Univ Int Business & Econ, Sch Finance, Shanghai, Peoples R China

来源：

APPLIED ECONOMICS | 2023年 / 55卷 / 31期

基金：

中国国家自然科学基金;

关键词：

Ceo compensation incentives; government-controlling ownership; privatization; political connection; MULTIPLE LARGE SHAREHOLDERS; CORPORATE GOVERNANCE; EXECUTIVE-COMPENSATION; POLICY BURDENS; PRIVATIZATION; STATE; PERFORMANCE; PAY; INFORMATION; MARKET;

D O I：

10.1080/00036846.2022.2115973

中图分类号：

F [经济];

学科分类号：

02 ;

摘要：

This paper investigates the relationship between government-controlling ownership and CEO compensation incentives in China, using a comprehensive evaluation of CEO pay-performance sensitivity (PPS). We find that government-controlling ownership weakens CEO PPS, with PPS being around 6 lower for CEOs in state-owned enterprises (SOEs) than CEOs in non-state-owned enterprises (non-SOEs), representing a reduction of around 14% for a CEO with the average level of PPS. The results sustain after using privatization as the experiment setting wherein firms' ultimate controllers changed from government owners to private owners. Moreover, the negative influence of government controlling ownership on CEO compensation incentives is more prominent in SOEs with a higher level of government ownership or a lower hierarchy government as the controller. We also explore the association between CEO incentives and firm performance and find that PPS in SOEs is more important in association with firms' stock performance than non-SOEs. Results in this paper extend studies on the influence of government controlling ownership on CEO compensation incentives, an issue that is caught much attention in the ongoing reform of China's SOEs.

引用

页码：3561 / 3579

页数：19

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