An Empirical Research on Determinants of CEO Compensation Based on Chinese Public Companies
Yue Qi, Lan Hai-lin, Jiang Luan
Abstract
Yue Qi, Lan Hai-lin, Jiang Luan
Abstract
This research investigated determinants of CEO compensation, focusing the relation between ownership structure and CEO compensation based on a sample of Chinese public companies. In firms with dispersed ownership, CEO compensation is more strongly related to corporate size than that in firms with concentrated ownership, while CEO compensation is more positively related to corporate financial performance in firms with concentrated ownership than in firms with dispersed ownership. The founding also shows that the CEO will be paid more if there is a compensation committee in a company and corporate status can affect CEO compensation. In addition, firms with concentrated ownership perform better than firms with dispersed ownership and CEOs are motivated with more managerial ownership in latter than in former.
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This research investigated determinants of CEO compensation, focusing the relation between ownership structure and CEO compensation based on a sample of Chinese public companies. In firms with dispersed ownership, CEO compensation is more strongly related to corporate size than that in firms with concentrated ownership, while CEO compensation is more positively related to corporate financial performance in firms with concentrated ownership than in firms with dispersed ownership. The founding also shows that the CEO will be paid more if there is a compensation committee in a company and corporate status can affect CEO compensation. In addition, firms with concentrated ownership perform better than firms with dispersed ownership and CEOs are motivated with more managerial ownership in latter than in former.
Key concepts: Business, Compensation (psychology), Executive compensation, Sample (material), Accounting, Public ownership, Corporate governance, Industrial organization