The Research On The Effects Of Anagement Ownership Plans Of Listed Companies

Stock ownership incentive plans appeared in the 1950s in America,then spread around all over the world. China practiced such activities in 1990s,and managerial ownership gained special attention because public listed companies needed it to encourage their managers to make work for the benefit of the stock holders. Recently China launched a reform to solve the problems of stock market, which will influence Stock ownership plans greatly. Obviously,there will be great future for the practice of stock ownership incentive plans,including managerial ownership incentive plans.Yet there are still many doubt whether management ownership incentive plans could have effective influence on companies performances. So it is necessary to know how the stock ownership incentive plans run in China and whether it had good effects. Based on the Agent Theory and Human Capital Theory,this dissertation uses the newest data to perform a research which checks the relationship between management stock ownership rate and ROE. The results indicate that management stock ownership ratio does have a significant effect on financial performance though not very strong. So there is no doubt that Stock ownership incentive plans,including management stock ownership should be conducted in China.