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Risk-based Performance, Nature of Property and Executive’s Steady Compensation: Evidence from Chinese Corporations

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  • Danlu Bu
  • Homayoon Shalchian

Abstract

In this paper, we analyze the steadiness of executive compensation relative to the financial performance of Chinese enterprises. We dissociate the firm’s operating performance and risk-based performance (changes in firm’s fair value) and we examine separately the steadiness of executive compensation relative to each portion of a firm’s performance. Our results show that in China, executive compensation is somewhat steady relative to the firm’s performance and more particularly to the firm’s risk-based performance. Our results also suggest that executive compensation is relatively steadier in the Chinese state-owned enterprises and, more particularly, in the firms controlled by local (provincial) governments. Â

Suggested Citation

  • Danlu Bu & Homayoon Shalchian, 2017. "Risk-based Performance, Nature of Property and Executive’s Steady Compensation: Evidence from Chinese Corporations," Accounting and Finance Research, Sciedu Press, vol. 6(1), pages 1-57, February.
    • Handle: RePEc:jfr:afr111:v:6:y:2017:i:1:p:57
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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