How ownership and corporate governance influence chief executive pay in China's listed firms

Michael Arthur FIRTH, M. Y., Peter FUNG, Oliver M. RUI

Research output: Journal PublicationsJournal Article (refereed)peer-review

199 Citations (Scopus)


This article contributes to the international corporate governance literature by examining factors that affect CEO compensation in China. The article develops models of CEO pay based on an understanding of the unique economic and structural reforms undertaken by the privatized State Owned Enterprises. The findings show that CEO compensation depends, in part, on the firm's operating profits and this indicates that incentive systems are being used to motivate top managers. Corporate governance factors have a significant impact on CEO compensation, but they do so in ways that differ from those in other countries. The conclusions are robust across different formulations of the basic model and they have public policy implications for China and other transitional economies that are moving away from state ownership of business enterprises.
Original languageEnglish
Pages (from-to)776-785
Number of pages10
JournalJournal of Business Research
Issue number7
Publication statusPublished - 1 Jul 2007


  • Ownership; Board structure; Executive compensation

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