The Study On Senior Executive's Stock-based Incentive In Our Listed Company

The primary goal of executive equity incentive is to align the interests of management with those of shareholders and to stimulate management to maximize shareholders' wealth and social value. As an effective long-run incentive mechanism tackling with all kinds of principal-agent problems in companies, equity incentive mechanism has been widely used in modern western companies since 1980's last century and won prominent success. Since 1990's, domestic researchers and companies began to investigate this kind of incentive mechanism and put it into practical application. Meanwhile, there have been a lot of articles on how to design, improve and extend the implement of equity incentive mechanism in literature. However, considering the present development stage of Chinese economy, one may doubt this kind of incentive mechanism may bring the same satisfying result in Chinese practical environment just as it did in its western application. As we know, although equity incentive mechanism theory has been well developed, its application situations in China would be quite different from its western counterpart.In order to produce a better effect of the stock-based incentive mechanism in our country, this paper focuses on the senior executives' stock-based incentive issue in our listed companies and reviews the relation between it and the achievement of the company. Through positive research the author finds out the crux of the irrelevant between them and puts forward some elementary suggestions on the perfection of the stock-based incentive of the listed company's senior executives in our country.This paper is composed of six chapters and logically can be divided into three parts. In the first part, we have a comprehensive review of the literature in this field and go over the fundamental theory of equity incentive mechanism. The current application status of equity incentive mechanism in China and experiences oversea are included in the second part. We carry out our empirical study of the post-implementation effects of these companies based on our performance-evaluation model in the third part and do some further theoretical research in combination with the empirical result obtained. We also give some elementary suggestions on the perfection of the stock-based incentive of the listed company's senior executives in our country in this part.