Ownership concentration and executive compensation in emerging economies: evidence from China

The research on corporate governance has different perspectives on the relationship between ownership concentration and executive compensation, and the empirical findings on this linkage are also inconclusive. The purpose of this paper is to investigate the impact of ownership concentration on executive compensation in emerging economies.

By connecting different perspectives with the characteristics of emerging economies together, this research explores the impact of ownership concentration on executive compensation, and then empirically tests the hypotheses based on the archival data of publicly held firms in China.

The paper finds that there is no significant relationship between ownership concentration and executive compensation in state‐owned enterprises (SOEs), while there is a U‐shaped relationship in non‐SOEs.

This study not only offers an empirical test of the effect of ownership concentration on executive compensation, but also provides some insights into the debates on the relationship between ownership concentration and executive compensation in emerging economies.