China Listed Company Equity Incentive Problem Research

The separation of proprietary rights and the right of management leads to the problem ofentrusted agency. Shareholders and managers are linked by a series of contacts. However, they havedisagreements in their aims. Based on the assumptions of rational actors in economics, there are conflicts ofinterest in nature when they maximize the benefits on their own behalf. This nature can be seen from theasymmetric information between shareholders and managers, incomplete contacts and the loss ofevaluation for efforts which are made by managers. Equities incentive, as an effective incentive mechanismwhich can be effective for long, will greatly resolve the problems of entrusted agency between them andavoid shortsighted actions and promote the long-term development of enterprises. So it is necessary tostudy the equities incentive of enterprises in a real case.The article finds actual situation of Shenzhen Wanke equity incentive programs, and uses relevanttheories to study and analyze the equity incentive scheme of the Shenzhen Wanke comprehensively andmeticulously. It describes the content of the scheme, summarizes the reasons for the failure, and analyzesthe cause of failure and summarizes the lessons that the case gives to the perfection work of equitiesincentive system in our country.Part Ⅰ Introduction. This part systematically states the applying background of the project, theresearch significance of the project, and the aims of the study as well as the thinking and structure of thepaper.Part Ⅱ：This part aims to introduce the definition and theory related to equity incentive and thepresent situation of equity incentive in abroad while analyzing equity incentive through the case fromforeign companies.Part Ⅲ：The introduction of the equity incentive scheme of the Shenzhen Wanke. This mainlyintroduces the basic information and the background of the company. It also analyzes the content of theequity incentive scheme that Shenzhen Wanke used now and before.Part Ⅳ：The comprehensive evaluation and analysis based on the equity incentive scheme ofShenzhen Wanke. This part analyze the equity incentive scheme in terms of each detail, and give systematical analysis of the scheme to find the worth-leaned meaning of the scheme.Part Ⅴ： Giving advices to the problems that the quoted companies in our country confront whenthey enforce the equity incentive plan. This part points out the problems that the quoted companies in ourcountry confront when they enforce the equity incentive plan and the problems that quoted companiesmight meet in the equity incentive designing work when coming up with the suggestion to complete theequity incentive scheme of the quoted companies in our country.Part Ⅵ：Conclusion. This part summarizes the five parts, and points out the limits of the paperthat should be improved in future work.The innovation of the article: first, the article uses the method of case study to analyze the theequity incentive scheme of Shenzhen Wanke comprehensively and systematically, including both the pointsof proper and not proper. Second, learning from the case of Shenzhen Wanke, the article gives practicaladvices for the quoted companies in our country to find a proper equity incentive scheme and makes thescheme really works.