TY - JOUR

T1 - Informativeness of performance measures and Chinese executive compensation

AU - Cordeiro, James

AU - He, Lerong

AU - Conyon, Martin

AU - Shankar Shaw, Tara

PY - 2013/12

Y1 - 2013/12

N2 - We provide evidence on the use of accounting versus stock market performance measures as determinants of Chinese top managers’ compensation over 2001–2007. We theorize and find that (1) accounting returns are weighted more heavily in general than stock returns in determining top executive compensation, (2) state-owned enterprises (SOEs) rely significantly less on stock market returns than do non-SOEs, (3) firms located in high marketization regions rely more heavily on stock market returns to reward managers, and (4) firms with better internal governance quality rely more on stock returns to reward executives. We discuss our findings with particular reference to the Chinese context of our research.

AB - We provide evidence on the use of accounting versus stock market performance measures as determinants of Chinese top managers’ compensation over 2001–2007. We theorize and find that (1) accounting returns are weighted more heavily in general than stock returns in determining top executive compensation, (2) state-owned enterprises (SOEs) rely significantly less on stock market returns than do non-SOEs, (3) firms located in high marketization regions rely more heavily on stock market returns to reward managers, and (4) firms with better internal governance quality rely more on stock returns to reward executives. We discuss our findings with particular reference to the Chinese context of our research.

KW - Executive compensation

KW - Performance measures

KW - China corporate governance

KW - Marketization

KW - Institutions

U2 - 10.1007/s10490-013-9353-9

DO - 10.1007/s10490-013-9353-9

M3 - Journal article

VL - 30

SP - 1031

EP - 1058

JO - Asia Pacific Journal of Management

JF - Asia Pacific Journal of Management

SN - 0217-4561

IS - 4

ER -