Executive compensation incentives, risk level and corporate innovation

By Bing Zhou, Yu-meng Li, Fangcheng Sun, Zhong-Guo Zhou. 2021

123 citations recorded by the source corpus.

Abstract This paper explores the innovation of Chinese listed companies from the perspectives of CEOs' compensation and corporate risk. We find that executives' salary can effectively promote firms' investment in research and development (R&D), while equity compensation failed to promote corporate R&D investment. Besides, the level of corporate risk has a mediating effect between executives' salary and corporate R&D investment. However, corporate risk level has a moderating effect between equity compensation and corporate R&D investment. When the level of risk is higher than a certain level, the negative impact of executives' equity compensation on innovation input becomes more obvious.

Subfields: Accounting, Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/a164bf325547f7da1bcc95054b4bfcda4d230bde