A Research On The Influence Of Equity Incentives On The Interests Of Shareholders

As China's modern enterprise system and gradually establish and improve equity in the Western popular incentive system is also more and more of firms. Equity incentives to the interests of shareholders together with the management to reduce short-tem management and reduce agency costs, thereby improving corporate governance, enhance corporate value. However, in practice, often also have the management equity incentive hollowed out by the company, damaging the interests of shareholders scandal. Because our legal system, institutional background and the corporate governance structure different from the current equity incentive has been successfully running the Western society. Thus, in our equity incentives to maximize shareholder value in the end is to achieve a panacea or the management of rent-seeking tool? This is the core issue of this paper.In this paper, Yili case as the carrier, through its equity incentive program to explore the detailed analysis of the subject of this article:the management equity incentive is to maximize shareholder value or rent-seeking. And reached the following conclusions:1.Queen equity incentive plan through the implementation of several special events and the corresponding point of the Queen of industry price index and the Shanghai index to compare the same time, changes in executive compensation and profit Erie analysis, the high hopes as previously Panacea equity incentive has evolved in the Erie shares a tool for management of rent-seeking.Second:Queen of the shares of the implementation of equity incentive programs cause damage to the interests of shareholders as follows: 1,Queen of shares over-equity incentive motivation; 2,the exercise price is unreasonable and in violation of policy; 3,the evaluation index is too low, so that incentives to become welfare; 4,effective incentive period is too short, long-term incentive hit;5,incentive costs Included in the current profits, market crash.Third:Queen of the reason why the shares of equity incentive is the root cause of deterioration:multi-agent system of state-owned enterprises produce "internal control. "Fourth:a detailed analysis of the process leads to the Queen equity incentive three major issues:1, concentrated equity incentive expensing the cost of the problem; 2, the executive waiver issues; 3, modify the underlying problem of equity incentive programs. And the corresponding results.Concluded that capital market imperfections in the current circumstances, to effectively play the positive effect of equity incentives, we must rely on the corresponding legal system supporting continuous improvement and reasonable corporate governance structure, independent board of directors and compensation committee independence, the most important Is to solve the problem of internal control, the only way to achieve equity incentive should be a positive incentive effect.