Abstract
Because of its own characteristics of innovative enterprise, benefit of innovative enterprise depends more on senior executives' creative contribution, and the incentives for senior executives of innovative enterprise is more valued by the market. The paper uses innovative enterprises of East China as samples, and analyses empirically the relationship between senior executives' payments, stock equity incentives and performances of innovative enterprises. The result shows that senior executives' payments has a significant positive correlation with performances of enterprises, however, senior executives' shareholding ratio has no significant correlation with performances of enterprises, and the concentration of stock equity has a significant positive correlation with performances of enterprises when performances measured by the rate of return on common stockholders' equity (ROE). It illustrates that payment is better than stock equity in promoting performances of innovative enterprises, and to a certain extent, equity control replaced the effectiveness of equity incentives.
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