Research And Design Of Equity Incentive Mechanism Of Listed Companies' Executives In China

Equity incentives, as the most important way of a long-term incentive pay system, it is a new hot spot that Emerged in Chinese listed companies in more than two years. Equity incentive is to allow the operators to hold the stock or stock options to become shareholders of enterprises.It is a long-term incentive approach that makes the personal interests and the interests of enterprises be linked to stimulate the operators to enhance long-term value to increase their own wealth.Based on Chinese listed companies executives equity incentives for research,we find out the problems of listed companies executives equity incentives by the analysis of status of listed companies executives equity incentive, effects test of listed companies equity incentive and the correlation between the incentive level of executives and Companies'performance.As the main factors that affect equity incentive are decided by the market environment and the company's internal governance, the market environment can't be changed in a short time. We can only improve the internal mechanisms of companies to promote the development of equity incentives of executives. In order to solve the problem ,this article put forward a solution. We design related elements of equity incentive of listed companies'executives.We resolve the ownership, stock-option price and the number of granted stock(options) and other important issues by the methods of economics , game theory and quantitative analysis. And it is an innovation of this article.However, empirical studies of this article have some limitations. First of all,it reflected in the choice of performance indicators. The net assets yield reflects only short-term performance of the company, but not reflect the level of long-term performance, so it has some linitations. The time when listed companies carry out the machanism of equity incentive is inconsistent.some companies carried out the machanism before 2006, some carried out the machanism after 2006,and some carried out the machanism just now.The performance level of executives could not be reflected in a shot time and it has a negative impact on the determine of the effect of equity incentives.So the effect of listed companies'Executives equity incentives needs further proof of the practice..As China's capital market continuing to be refined, the level of corporate governance of listed companies improved as well as the continuous improvement of equity incentives system,executives of China's listed companies will be able to develop continuously, and promote the performance of listed companies continuously.It will ultimately enhance the the overall level of capital markets and effective degrees.