China 's Employee Stock Ownership System And Its Perfect

The system of the employee stock ownership (or be said Employee Stock Option Plan, ESOP) is a kind of system which means that part of the company's shares is held by its employees, by which the employees take part in managing the enterprise, monitoring the enterprise and sharing the profit of the enterprise. As a new form of property, ESOP can encourage employee to work hard, to improve the productive efficiency, to relax the contradiction between the employee and employer, to solve other inherent problems of company. Thus, it is becoming the trend of reform in the world. Since 80's year last century, the ESOP of west countries was introduced into china, and developed gradually. But the ESOP in China had led to some confusion, because there is absence of high-level law to regulate it and diversifying patterns and strong regional feature of the ESOP. This article analyzes the defects and the main legal problems of ESOP in China, tries to draw on the legislation experiences of west countries, and puts forward the principle of China's ESOP and the legislation suggestion in China. The main body of the article includes introduction, main body and epilogue. The main body includes four parts.In the first part, the author briefly analyzes ESOP's base in jurisprudence and values, probes into the necessity of China's ESOP,In the second part, the author summarizes the experiences and lessons of the west countries about the ESOP, reveals the deficiencies of ESOP in west countries, objectly appraises the ESOP system. At last, the author gains enlightenment to china's ESOP from other countries' practices.In the third part, the author briefly reviews three stages in the development of China's ESOP. In China, different forms of holding shares arise two main patterns of the internal employee's holding shares and the employee member's committee's holding shares. And then, the author analyzes the main problem of the two patterns encountered by China's ESOP.In the forth part, the author had pondered the legal system of China's ESOP. The way to improve China's ESOP depends on the many aspects. First, China's ESOP needs to introduce the notion of human capital. Human capital is the footstone of the ESOP. It is the key step that establishing human property right law system. Human property right law system is the law basis of the ESOP and the guide to china's law system improvement.The company needs further option right to ensure the extension of employee andmust make a rational choice by itself.The law-making of ESOP in China needs joining the strong points of integrating law-making and single law-making, center law-making and region law-making. As a whole, the law-making of ESOP in China must stick to two principles, first, it must exert the inspiration and restriction functions of ESOP, and second, it must protect the right and benefit of the employee.Based on the notions mentioned above, the author tries to discuss the improving measures of China's ESOP from four aspects, such as the source of shares held by employee, the management of the share held by employee, the ESOP and employee participation, the encouragement and support from government.i . Chinese government needs to modify corporation law to let the company obtain employee's shares. The shares distributing principle is in mainly based on the company self-governing and unifying of duty, right and benefit. The employees can buy the shares at the price of no lower than the market price. It needs to be permitted that employee can by the company's shares by stages in a term.ii. Employee's shares should be governed by the employee's committee, and restricted to transit as usual. The nature of the employee's committee is a nonprofit internal organization of the company and a self-managed organization free from the manager's management.iii. The employee participation is related to ESOP. The percent of the employee's shares should be no more than the first shareholder of the company. And the employee's voting right should be guaranteed.iv . The government encouragement and support should include market supports favorable taxing and finance policy to some degree and the improving system of social guarantee and law relief.ESOP is not an isolated system and it needs the unity of two systems improvement of the ESOP and the external condition. It is the key to improve China's ESOP that balancing the law regulating and company's self-governing, uniting the law transfer of the ESOP and finding the features of China own. With the further improvement of China's ESOP, the author thinks the ESOP will be an important system to company development in China.