A Study On The Effect Of Equity Incentive In Listed Companies

With the separation of ownership and management, the contradictions between trust and proxy have become increasingly prominent, which arises equity incentives to be an important solution for this conflict. Generation and application of the equity incentive could make managers and operators have the same goal, thus to avoid some behavior to some extent, such as the increasing of agency cost, on-the-job consumption and the risk of moral hazard; On the other hand, the implementation of equity incentive can also help enterprises to retain the core management and technical personnel.On the western capital markets, equity incentive is already relatively mature sound, while it was officially started in 2006 in China and is still in the initial stage of exploration. Our exploration for equity incentive has been continuing since 2006, but we still could not get a unified conclusion and its effectiveness is not as good as imagined. Nevertheless, according to research by scholars, we can find that most of the scholars and the companies are still holding positive attitude towards the equity incentive. Furthermore, equity incentive will become an important part of corporate governance for all public companies as a long-term incentive mechanism.This article through to the analyses of Qingdao Haier equity incentive plan, summarized its advantages and disadvantages, and according to the characteristics of the incentive scheme and national conditions of our country puts forward related suggestions, provide reference for the implementation of equity incentive plan for the following company.