A Positive Study Of The Incentive Effect Of Executive Stock Option Of The State-owned-listed Company

With the development of state-own enterprise reform in China, it has made big progress on compensation incentive mechanism for the state-owned listed companies. As a compensation incentive system, the stock option has been applied in the state-owned enterprises, especially in the listed companies. At the same time, the researchers affirm the incentive effect of stock option by introducing successful examples. The stock option is regarded as the most potential incentive way in incentive system in future.The paper takes the executives of the state-owned listed companies as the object of the study, and takes the stock option as the study standpoint. In the theory part, it analyses environmental factors which may affect the effect of the executive stock option, and analyses the positive effect and the negative effect of the executive stock option. In the positive study part, it researches the incentive effect of the executive stock option, using factor analytic method,reckoning method and stepwise regression analysis, according to the incentive mechanism of the stock option. Finally, it researches the relevance between performance and stock price. It is concluded that weak validity of the stock market in China becomes strengthen increasingly, which offers good market environment for the state-owned listed companies to apply executive stock option.In summary, it is concluded that it has certain degree effect for the state-owned listed companies to apply executive stock options in China. Because of many restricted factors, the paper gives some suggestions for the state-owned listed companies which will apply executive stock option that make contributions to deepen the reform of the state-owned companies.The paper makes breakthrough on executive payment-to-performance sensitivity. The author names a new method to measure executive payment-to-performance sensitivity as reckoning method, which is based on elasticity in the economics. At the same time, the paper researches the executive payment-to-performance sensitivity by another method, which is called stepwise regression. It is concluded that the best proper range will contribute to promote the company's performance by the reckoning method. It builds a series of functions between executive's payment and performance, using SPSS to analyze the executive payment-to-performance. Finally, it compares the reckoning method with stepwise regression.