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A Study on the Impact of Executive Compensation and Executive Shareholding Ratio on Corporate Performance-A Case Study of Qiming Information

Author(s)

Feifei Li1, Xiaoyan Liu1, Ziqi Ding1, Ao Zhang2,*

Affiliation(s)

1School of International Business, Jilin International Studies University, Changchun, Jilin, China 2School of Accounting, Jilin University of Finance and Economics, Changchun, Jilin, China *Corresponding Author

Abstract

In the modern corporate governance system, executives serve as the core decision-making body, and the connection between their incentive mechanisms and corporate performance has long been a focus of attention in both academic and practical circles. This paper takes Qiming Information as the research object, selecting its annual report data from 2018 to 2023. It uses average executive compensation and executive shareholding ratio as two core explanatory variables, takes Return on Equity (ROE) as the indicator for measuring corporate performance, and incorporates corporate size and asset-liability ratio as two control variables. By applying descriptive statistics, correlation analysis, and multiple linear regression methods, this paper empirically tests the impact of executive incentives on corporate performance. The results show that both average executive compensation and executive shareholding ratio have a significant positive correlation with Qiming Information’s ROE, indicating that reasonably increasing executive compensation and raising the executive shareholding ratio can effectively promote the improvement of corporate performance. Based on this finding, this paper puts forward targeted suggestions for Qiming Information to optimize its executive incentive mechanism and also provides a reference for similar enterprises.

Keywords

Executive Compensation; Executive Shareholding Ratio; Corporate Performance

References

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