Taking a balanced panel data consisting of 4365 firm-year observations drawn from the listed state-owned enterprises in Shanghai and Shenzhen Stock Exchange over 2007-2015 as the research sample,the paper examines the...Taking a balanced panel data consisting of 4365 firm-year observations drawn from the listed state-owned enterprises in Shanghai and Shenzhen Stock Exchange over 2007-2015 as the research sample,the paper examines the effect of the employees’pay-performance sensitivity(PPS)on the future firm performance from the two competing perspectives of“incentive effect”and“risk-aversion effect”,adopting the method of multiple regression analysis based on OLS and applying the SPSS23 as the data processing tool.Theoretical analysis and empirical results demonstrate that there is a positive link between the employees’PPS and the future firm performance.To improve the employees’PPS can stimulate the engagement of the employees,improve their working quality,enrich their workplace innovative behavior,and further lead to higher future firm performance.Meanwhile,the positive effect of the employees’PPS on the future firm performance is,on average,lower than that of the top executives’PPS on the future firm performance.Implications of the findings are provided in the end.展开更多
Because prior studies find mixed results on the relation between CEOs’pay performance incentives and a firm’s likelihood of financial reporting fraud,we restudy their relationship using innovative research methods.F...Because prior studies find mixed results on the relation between CEOs’pay performance incentives and a firm’s likelihood of financial reporting fraud,we restudy their relationship using innovative research methods.First,we concentrate on incentives from granting options rather than equity-based incentives.Second,we emphasize vested options,disregarding unvested option holdings,and take the logarithm transformation of option incentives.Third,we analyse the impact of option incentives on future financial reporting irregularities.Using this innovative approach as well as a full sample and a matched sample,we find that an increase in executives’option incentives raises the likelihood of financial reporting violations.Moreover,the effect of option incentives on financial reporting fraud is moderated by auditor effort.In addition,we find that another proxy for the measurement of executives’option incentives,namely,the number of vested options by executives,is highly correlated with the CEO’s vested stock option sensitivity.展开更多
Few studies have focused on the role of non-CEO top manager inside directors in corporate governance,especially in the context of emerging countries.Despite their tendency to be subject to CEOs,non-CEO top manager ins...Few studies have focused on the role of non-CEO top manager inside directors in corporate governance,especially in the context of emerging countries.Despite their tendency to be subject to CEOs,non-CEO top manager inside directors can counterbalance CEOs in specific situations.Using panel data on state-owned listed companies in China,we conduct an empirical study of how non-CEO top manager inside directors influence CEO pay-performance sensitivity under serious agency conflicts.We find that the proportion of non-CEO top manager inside directors is significantly negatively correlated with CEO pay-performance sensitivity in state-owned enterprises,whereas the shareholding proportion of the controlling shareholders weakens this relationship.Furthermore,we find that non-CEO top manager inside directors significantly increase executives’on-the-job consumption.Our conclusions are robust to endogeneity testing and alternative specifications.展开更多
Using creditor litigation data from China,we investigate whether creditors can participate in corporate governance when agency conflict between shareholders and creditors is severe.By comparing firms that have experie...Using creditor litigation data from China,we investigate whether creditors can participate in corporate governance when agency conflict between shareholders and creditors is severe.By comparing firms that have experienced creditor lawsuits(litigation firms)with those that have not(non-litigation firms),we find that litigation firms have lower pay-performance sensitivity before lawsuits,suggesting that these firms have weaker corporate governance.This result is consistent with our expectation that creditors participate in corporate governance by introducing external monitoring when internal monitoring,dominated by shareholders,is insufficient.We also find that the association is stronger for firms with more severe shareholder-creditor agency conflict.Moreover,creditor litigation is strongly related to low pay-performance sensitivity when the external legal environment is strong.Our results remain robust to different model specifications and after addressing endogeneity problems.展开更多
基金This research was supported by the National Natural Science Foundation of PRC under Grant"71872149".
文摘Taking a balanced panel data consisting of 4365 firm-year observations drawn from the listed state-owned enterprises in Shanghai and Shenzhen Stock Exchange over 2007-2015 as the research sample,the paper examines the effect of the employees’pay-performance sensitivity(PPS)on the future firm performance from the two competing perspectives of“incentive effect”and“risk-aversion effect”,adopting the method of multiple regression analysis based on OLS and applying the SPSS23 as the data processing tool.Theoretical analysis and empirical results demonstrate that there is a positive link between the employees’PPS and the future firm performance.To improve the employees’PPS can stimulate the engagement of the employees,improve their working quality,enrich their workplace innovative behavior,and further lead to higher future firm performance.Meanwhile,the positive effect of the employees’PPS on the future firm performance is,on average,lower than that of the top executives’PPS on the future firm performance.Implications of the findings are provided in the end.
基金financial support from the National Natural Science Foundation of China(Grant No.71620107005)the 111 Project“Innovation and Talents Base of Financial Security and Development”(Grant No.B18043)support from the Chinese National Science Foundation(No.71672149 and No.71972157)
文摘Because prior studies find mixed results on the relation between CEOs’pay performance incentives and a firm’s likelihood of financial reporting fraud,we restudy their relationship using innovative research methods.First,we concentrate on incentives from granting options rather than equity-based incentives.Second,we emphasize vested options,disregarding unvested option holdings,and take the logarithm transformation of option incentives.Third,we analyse the impact of option incentives on future financial reporting irregularities.Using this innovative approach as well as a full sample and a matched sample,we find that an increase in executives’option incentives raises the likelihood of financial reporting violations.Moreover,the effect of option incentives on financial reporting fraud is moderated by auditor effort.In addition,we find that another proxy for the measurement of executives’option incentives,namely,the number of vested options by executives,is highly correlated with the CEO’s vested stock option sensitivity.
基金the financial support of the National Natural Science Foundation of China(Project 71602059,71872192,71602039)the Natural Science Foundation of Guangdong Province,China(Project 2015A030310223,2016A030313482)the Humanities and Social Science Fund of Ministry of Education of China(Project 15YJC630051).
文摘Few studies have focused on the role of non-CEO top manager inside directors in corporate governance,especially in the context of emerging countries.Despite their tendency to be subject to CEOs,non-CEO top manager inside directors can counterbalance CEOs in specific situations.Using panel data on state-owned listed companies in China,we conduct an empirical study of how non-CEO top manager inside directors influence CEO pay-performance sensitivity under serious agency conflicts.We find that the proportion of non-CEO top manager inside directors is significantly negatively correlated with CEO pay-performance sensitivity in state-owned enterprises,whereas the shareholding proportion of the controlling shareholders weakens this relationship.Furthermore,we find that non-CEO top manager inside directors significantly increase executives’on-the-job consumption.Our conclusions are robust to endogeneity testing and alternative specifications.
基金support from the National Natural Science Foundation of China(#71572210,#71802205)the Fundamental Research Funds for the Central Universities(#SWU1909771)
文摘Using creditor litigation data from China,we investigate whether creditors can participate in corporate governance when agency conflict between shareholders and creditors is severe.By comparing firms that have experienced creditor lawsuits(litigation firms)with those that have not(non-litigation firms),we find that litigation firms have lower pay-performance sensitivity before lawsuits,suggesting that these firms have weaker corporate governance.This result is consistent with our expectation that creditors participate in corporate governance by introducing external monitoring when internal monitoring,dominated by shareholders,is insufficient.We also find that the association is stronger for firms with more severe shareholder-creditor agency conflict.Moreover,creditor litigation is strongly related to low pay-performance sensitivity when the external legal environment is strong.Our results remain robust to different model specifications and after addressing endogeneity problems.
