Research On Equity Incentive Plans Of Chinese Enterprises

Since the latter half of last century onwards, equity incentive has been widely recognized and promoted in developed western market economy countries. In the past few decades, equity incentive theory and empirical analysis had always been a hot issue which domestic and foreign scholars researched. Although there were many differences in theory, the practical significances of equity incentive has been increasingly recognized and valued. Practices of many companies had proved that equity incentive plays a very active role in improving the corporate governance structure, reducing agency costs, improving management efficiency and enhancing the cohesion and competitiveness of enterprises.Over the past decade, Chinese listed companies have been conducting exploration of equity incentive and progressing with frustration. As an effective long-term incentive, equity incentive plays a significant role in improving the pay system of enterprises, promoting the dynamic development of enterprises. How to solve the existing problems during the implementation of equity incentive for Chinese enterprises is an urgent question that needs to be concerned.Vanke's restricted stock incentive plan which is the first equity incentive program of A-share listed companies in China that have been approved by supervision department, arouses the concern of many companies and researchers. However, the implementation process is not smooth. Since the program has distinctive characteristics of Chinese enterprises, this plan has a important reference to Chinese listed companies implementing equity incentive plan.The paper will take the case of Vanke, which has great representativeness, as the starting point of our research on China's enterprise equity incentive plans. This paper bases on actual cases and the experience of existing research results and defects and takes the existing research defects as the starting point, specifically analyzing the selection of incentive mode, the performance assessment indicators, the appropriate amount of incentive funds, incentive stock source, accounting etc, and elaborating the elements of perfect equity incentive plan and measures. In the end, making suggestion on setting up equity incentive on Chinese enterprises, and proposing external environment and other auxiliary means.