Backgammon Corporation Executives Incentives To Optimize The Design

This article begins from analyzing the development situation and the micro-environment it is facing, using incentive mechanism as guide, it has review and summarize many factors impacting on the establishment of executives' incentive mechanism, using the experience of incentive on executives in the domestic and foreign enterprises as reference , combining the BETTER LIFE Company's own system features and now the insufficient of executives reward incentive mechanisms for a long term problem, it exploits an incentive model of "annual salary + shares + emotion" which is fit for BETTER LIFE COMPANY executives , the aim is to change the current executives insufficient incentives and the poor restrain status.Among the separation of two ownerships, executives play a important role in the company's success, while the design of the incentive mechanism has a direct effect to their behavior. Generally speaking, the more extent of two ownerships separation, the bigger of the effect of incentive reward to shrink the difference of the owners and the executives and to decrease the supervise cost.Incentive and restrain are the two aspects of a problem, when the incentive mechanism is optimized design, which needs not only to consider a valid incentive mechanism for executives, but also set up appropriate, supervise restrain mechanism, in order to get a good incentive result.The article refers to the incentive compensation assessment criteria system, when it is to be discussed, should divide into long-term and short-term, not as a whole. For short-term incentive performance index system, the article says that short period index only need reflect the contribution of temporary executives to company and the situation of preserving and increasing the value of corporate assets. Whereas, for long-term assets incentive performance index system, it points out that it is the best to choose economy value adding (EVA) as executive performance evaluation index.