Empirical Research Between Corporate Performance And Equity Incentive Based On SME Board Listed Company

2011 is the stock market downturn, but the enthusiasm of the equity incentives of listed companies is very high. To reduce the incentive costs or equity incentive can stimulate the company’s performance to struggle with the global crisis? On the one hand, the SME board listed companies are scrambling to launch equity incentive program, the other is the large number of equity incentive companies announced to terminate the equity incentive plan, and we want to find out the reasons for these.This paper attempts to proceed from the perspective of empirical research. Firstly, we want to find out whether the profitability changes after the equity incentives. Secondly, we use Principal component analysis method to determine the single dimension of variables to measure corporate performance. Thirdly, we use binary logistic regression to analysis the probability of the implementation of equity incentive, and how to ensure the implementation of equity incentive.The empirical studies showed that the SME board listed companies equity incentive is effective, for the rate of return on net assets and the company’s total market capitalization improved significantly, and corporate performance values obtained by principal component analysis also significantly increased. But the price-earnings ratio and inventory turnover rate did not show a significant improvement. In addition, corporate performance and is related positively correlated with equity incentive equity ratio and stock price volatility, negatively correlated with the Top Ten Shareholders proportion. Stock price changes on Secondary market is a main factor that effects probability a successful equity incentive implementation.At the end of the paper, we give some thoughts on how to make a successful equity incentive plan. We also give some advises on information disclosure system and professional managers system.