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Senior Management Remuneration System Based On Economic Value Added Research

Posted on:2003-09-22Degree:MasterType:Thesis
Country:ChinaCandidate:W ZhangFull Text:PDF
GTID:2206360065461048Subject:Business management
Abstract/Summary:PDF Full Text Request
The problem, which the stockholders are most concerned about, is how to get right and just performance appraisal. The traditional performance measured indexes are net profit after tax benefit per share and rate of capital etc. Yet these indexes can' t reflect the whole capital expense and profit. And so they can' t reflect the value of the stockholders. It will inevitably distort the goal of the maximum of the stockholder' s value.Just because of considering the cost of the debt and capital stock, the economic value added overcomes the shortcomings of the traditional measurable indexes, and reflects the value of the stockholders more accurately. Therefore how to apply and implement the index of the economic value added is pivotal to realize the maximum of the stockholder's value.Then this paper tries to design the compensation system based on economic value added to guarantee the combination of the value of managers and stockholders. Then it can solve the problem of principal-agent more effectively. There are two parts based on the economic value added in this compensation system, one is the cash dividend, and the other is the stock options, the result of this research is verified by ZTE company.
Keywords/Search Tags:Performance appraise, economic value added, compensation system
PDF Full Text Request
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