The impact of core competitiveness on pay for performance sensitivity

Wen Zong, Yanchao Liu, Aimei Li and Yueyue Zhang

Finance Research Letters, 2025, vol. 78, issue C

Abstract: Using China's A-share listed companies from 2008 to 2022 as a research sample, this paper empirically investigates the interplay between core competitiveness and the efficacy of compensation contracts, along with their underlying mechanisms. The findings reveal that an increase in core competitiveness enhances the sensitivity of pay to performance. Furthermore, the development of core competitiveness elevates the quality of accounting information, and enterprises with stronger core competitiveness possess more robust internal control systems, effectively overseeing managers' opportunistic behavior.

Keywords: Core competitiveness; Pay-performance sensitivity; Disclosure quality (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:78:y:2025:i:c:s1544612325003502

DOI: 10.1016/j.frl.2025.107087

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