Asia Pacific Journal of Management

, Volume 30, Issue 4, pp 1031–1058

Informativeness of performance measures and Chinese executive compensation

Authors

  • James J. Cordeiro
    • School of Business Administration & Economics, College at BrockportState University of New York
    • School of Business Administration & Economics, College at BrockportState University of New York
  • Martin Conyon
    • Lancaster Management SchoolLancaster University
  • Tara Shankar Shaw
    • Rajiv Gandhi Indian Institute of Management
Article

DOI: 10.1007/s10490-013-9353-9

Cite this article as:
Cordeiro, J.J., He, L., Conyon, M. et al. Asia Pac J Manag (2013) 30: 1031. doi:10.1007/s10490-013-9353-9

Abstract

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.

Keywords

Executive compensationPerformance measuresChinaCorporate governanceMarketizationInstitutions

Copyright information

© Springer Science+Business Media New York 2013