Research On Incentive-constraint Mechanism Of High Managers Of Financial Holding Company

Under the circumstances that China becomes a member of WTO , the finance is globalizing and the separated operation in financial field becames more and more popular, FHC is facing the unprecedented chances as well as serious challenges. Firstly, there are many weaknesses in corporate governance and mechanical supervision of new-building FHC due to historical and realistic reasons in China. Especially the unsound incentive-constraint mechanism of high-level managers is outstanding. Secondly, with the gradual opening of finance market and furious competition the financial institutions with different operations contest for high-level financial persons using effective incentive-restrictive mechanism. As a result, FHC is at the edge of existence and behindhand incentive-constraint mechanism becomes the bottleneck of FHC, which cripples its development. Thirdly, the study on incentive-constraint mechanism is weak in theoretical field under currently severe circumstances. Summarily, to build scientific, reasonable and efficient incentive-constraint mechanism of high-level manager in FHC must have important realistic and theoretical meanings. This dissertation summarizes the theories of incentive-constraint mechanism including the conception, main characteristics, special risk and status quo of FHC. On these bases, this dissertation analyzes the status quo of the high-level incentive-constraint mechanism and reasons. This dissertation studies the incentive-constraint mechanism using game theory, information economics and equality theory on two directions to. For one thing, it builds incentive-constraint mechanism of high-level managers for FHC according to proper characteristics including fulfilling incentive-constraint mechanism of high-level managers who appointed by the government using the game model, fulfilling incentive-constraint mechanism of the subsidiary companies'high-level leaders who have beneficial confliction with parent company by the way of game contracts and fulfilling incentive-constraint mechanism of the subsidiary companies'high-level leaders who feel unfair by the way of equality theory. On the other hand, it builds long-term incentive-constraint mechanism for high-level managers according to their own human characteristics by the two main ways of reputation mechanism and stock option mechanism. Finally, this paper puts forward some policy suggestions which perfect the incentive-constraint mechanisms of FHC by the perfection of corporations'internal governance and the constructions of legal circumstance, managers market, capital market and supervision system in China on the bases of the analysis above.