Research Of CEO Incentive Mechanisms Based On Sharing Of Reputation Value

The CEO of enterprises as a special kind of human capital have played a pivotal role in the success or failure of the business, therefore the issue bound by the incentive and constraint of CEO has been the core issue of enterprise development. With the modern enterprise’s ownership and control right separating, enterprise’s owners and CEOs all pay attention to the same focus on the difference of goal and benefit between enterprise’s owners and CEOs. However, the reputation evaluation system of China is not perfect, accompanying by "59-year-ole phenomenon". Therefore, the state-owned enterprises need to analyze the relationship between CEO’s reputation value and enterprise’s reputation value, and design an effective CEO incentive mechanism based on sharing of reputation value of enterprise.The thesis is based on the theory of enterprise reputation evaluation. First, the thesis makes an analysis of the composition of the enterprise value, which is divided into two parts, the deterministic asset’s value and non-deterministic asset’s value. Then, the non-deterministic asset’s value is divided into human capital value and reputation value. Therefore, the thesis establishes the theoretical model of evaluating enterprise reputation value. Second, through making evaluation of CEO’s business performance and behavior performance, the thesis makes out the scores of CEO’s performance, which is divided into several grades. And according the grade, the thesis makes the ratio of sharing of enterprise reputation value. At last, according the value of enterprise reputation and the ratio of sharing of enterprise reputation value, the thesis makes the method of sharing of the value of enterprise reputation, establishes the incentive mechanism model basing on sharing of the value of enterprise reputation. When the CEO quit the enterprise, he or she will receive a bonus which is transformed from enterprise value. Therefore, the method will reduce the "59-year-ole phenomenon". The thesis has a little value for CEO incentive both in theoretic and practice. And the thesis can provides reference value for establishing the evaluation system of enterprise reputation value.