Executive compensation and corporate governance in China

► Executive compensation is positively correlated to firm performance in China. ► Executive pay and incentives are lower in State controlled firms and firms with concentrated ownership structures. ► Chinese firms with more independent directors on the board have a higher pay-for-performance link. ► US executive pay (salary and bonus) is about seventeen times higher than in China. ► Significant differences between US-China executive pay persist after controlling for economic and governance factors.