This paper catalog the stateowned enterprise to two kinds of corporation, corporation controlled by the central government and controlled by local government according to the new state owned enterprise management system and the institutional background that different level government control different stateowned enterprise. Since the supervision of central and local government varies, the market risk of these two kinds of firms facing differ, and the concerns of pay for top managers in these two kinds of firms are not similar and pay plays different role for these firms. This paper found that pay performance sensitivity is lower for firms controlled by central government compared with those controlled by local government.