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Academic Journal of Business & Management, 2022, 4(19); doi: 10.25236/AJBM.2022.041903.

Executive Compensation, Executive Pay Gap and Firm Performance—Based on the Empirical Research of Listed Companies in China


Wu Qian

Corresponding Author:
Wu Qian

School of Economics and Management, Guangxi Normal University, Guilin, China


As one of the important means of motivating employees, salary has a very important impact on the performance of enterprises, as the core managers of enterprises, the working attitude and enthusiasm are directly related to the survival and development of enterprises. Different companies have different treatment standards and salary mechanisms for the same position, and the treatment standards of each senior management in the company are obviously different. This paper uses all listed companies in China from 2015 to 2020 as a sample and conducts empirical research. Two models were established to analyze the impact of executive compensation and executive pay gap on company performance. After putting forward hypotheses, design variables, empirical analysis and robustness test, it is concluded that the executive compensation and the executive pay gap of the company has a significant positive correlation with the company's performance, and increasing the salary of executives within a reasonable range and reasonably expanding the remuneration difference will help mobilize the work initiative of the company's senior management team. Thereby improving the company's performance.


Executive team, Executive compensation, Executive pay gap, Business performance

Cite This Paper

Wu Qian. Executive Compensation, Executive Pay Gap and Firm Performance—Based on the Empirical Research of Listed Companies in China. Academic Journal of Business & Management (2022) Vol. 4, Issue 19: 18-24. https://doi.org/10.25236/AJBM.2022.041903.


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