An Empirical Analysis Of The Relationship Of Managerial Ownership Incentive And Performance Of The Company

Managerial equity incentive mechanism have been widely recognized and promoted since the second half of the last century in the Western developed market economy countries. Listed companies in China has been to explore the implementation of equity incentive over the past decade, stock incentive mechanism as an effective long-term incentive mechanism for the development of enterprises of our country and internal governance have played a positive role.Even though domestic and foreign scholars on equity incentives in theory and empirical analysis has been made considerable achievements in the past few decades , the selection of this mechanism, in reality, and the effect of the actual implementation are still more controversial. In the process of corporate reform in our country, it has become the urgent need to explore questions in the concern on the relationship between equity incentives and enterprise performance and the current problems in equity incentive.This paper used the principal-agent theory, human capital theory, contract theory as the theoretical foundation, using a combination of normative and empirical approach, focused on the following:First is the implementation of equity incentive policies and the analysis of the status in China's central enterprises. In this paper, it analysis the status of equity incentives in China's central enterprises, using statistical analysis methods. Second is analysation on the implementation of China's listed companies of equity-based incentives. In this paper, the implementation of equity-based incentives in 2006 of the 31 listed central enterprises for the samples, analyzed by empirical methods.It comes to the conclusion of the study through these two studies: First, it does not exist very strong correlation between the proportion of the equity senior management holding and the operating performance in the company; Secondly, it does not exist "range effect" in the central enterprises which have been brought the incentives into effect; Third, it does not exist curve relationship between enior management and corporate ownership does not exist between the proportion of the equity senior management holding and the operating performance in the company. Finally an analysis of this paper, the inadequacies, as well as future research directions.