Research on CEO compensation stickiness of Chinese listed companies—Empirical evidence from the different situations of profits and losses

This paper studies the stickiness of CEO compensation by verifying the existence of asymmetric relations between CEO compensation and corporate performance in Chinese listed companies during 2005 to 2012, the results show that the marginal increase of CEO compensation in the case of corporate earnings to be significantly greater than the marginal reduction in the case of corporate deficit, which is tantamount to say that the stickiness of CEO compensation exists. Further research finds that the stickiness of CEO compensation in Chinese listed companies has not yet demonstrated significant time-varying trends; but there is sign of increased. We also find that the stickiness of CEO compensation can be suppressed by improving of regional marketization, shareholding system reform and diversified equity of state-owned companies, supervision of government, media and general public, and matrix control strategy.