Ownership Difference And Equity Incentive Effect

China introduced equity incentive plan from western developed countries in 1990s. Before non-tradable shares reform of 2005 in China, there were not any relevant laws or regulations specifically for equity incentive. On January 1st,2006, "the Listed Company Equity Incentive Regulations (Trial)" was officially implemented, at the end of the same year, the "State-owned Holding Listed Corporation Equity Incentive Pilot Scheme" even laid a strong legal foundation for equity incentive of state-owned holding listed corporation. Afterwards, China has welcomed an equity incentive booming. By the end of 2014, there have been over 500 listed companies implementing equity incentive. No matter state-owned holding listed corporation or private holding listed corporation, both of them show high hopes to companies’ long term development during the 12th Five Year Plan, which is the key period to intensive mode of economic growth of China. "The mixed ownership economy" will be the focus of the future reform of state owned enterprises, which cannot do without equity incentive.Under this background, however, the number of state-owned holding listed corporations which implement equity is much lower than the private ones. Superficially, the relevant laws or regulations of the state-owned holding listed corporations are much stricter than the private ones’, and the state-owned ones have received much more supervision. In fact, the deeper reason is that, state-owned holding listed corporation has complicated principal-agent relations, which makes the property right unclear. This paper mainly compares state-owned holding listed corporations with private ones on equity incentive theory, laws, performance, incentive mode and incentive ratio etc, and then explores whether equity incentive can solve state-owned enterprise’ property rights problem.This paper draws on the experience of research achievements both home and abroad, then summarizing the applicability and existing problems between state-owned listed enterprises and private ones. After that, the history, current situation and characteristics of equity incentive in China will be introduced to find out the differences and similarities between state-owned and private enterprises. This paper investigates different equity incentive performances between state-owned and private holding listed corporations by using empirical analysis and statistical analysis method, and then analyses the empirical results. At last, the conclusion will be obtained based on relevant theories and empirical results, which equity incentive can effectively ease but cannot get over state-owned enterprises property problem. According to the conclusion, policy advices will be suggested.In summary, this paper detailedly and deeply shows the distinctions between state-owned and private holding listed corporations on equity incentive theories, achievements and key elements, and proves the outcome that equity incentive can be the promotion of state-owned companies’ property problem instead of fundamental solution. Perfect equity incentive mechanism and friendly equity incentive environment are needed to help state-owned holding listed corporation to take the road of mixed ownership enterprises.