Executive compensation incentives, risk level and corporate innovation

Bing Zhou, Yu-meng Li, Fang-cheng Sun and Zhong-guo Zhou

Emerging Markets Review, 2021, vol. 47, issue C

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.

Keywords: Executive compensation incentives; Corporate risk level; Corporate innovation (search for similar items in EconPapers)
JEL-codes: D21 G34 M52 O32 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ememar:v:47:y:2021:i:c:s1566014121000066

DOI: 10.1016/j.ememar.2021.100798

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