The Failure Of Real Estate Company Equity Incentive

The year of2006is was the first year of post-split share structure reform, and it was the beginning of the implementation of equity incentive management approach. During the2006-2013, China has784listing Corporation in the equity incentive of its management and key technical staff. However, after statistics found that nearly60percent of which the company’s equity incentive plan failed to final implementation. Most of them were due to that the performance did not meet the equity incentive plan in the exercise conditions. Thus it can be seen, the equity incentive is ineffective implementation of embarrassment and confusion in the practice of China’s listing Corporation.Development of real estate industry is been concerned these years, the continuing rise in prices is also controversial. As one of the important power of China’s GDP growth, the macro-control and policy affects the stable and healthy development of the Teal estate industry, which deeply influenced the development of market economy in china. The equity incentive as real estate companies improve performance pay means, effective implementation, is of great significance for the healthy development of the real estate industry.The author through pre-press attention and data collection, and found mainly in the real estate industry, Milord Real Estate (000667, SZ) from2008to2012five-year period, launched equity incentive plans three times, but all ended in failure. Within a short span of five years, Milord Real Estate equity incentives failed three times to be unique in our many listed companies. The use of equity incentive, a way to solve agency problems, described in the Milord Real Estate extremely failed:lackluster, fell, executive turnover problems emerge in an endless stream. It is in the process of equity incentive presents various problems in other listed companies in the real estate equity incentive implementation process also occurred. The Milord Real Estate is an example to study the failure problems of real estate listing corporation equity incentive. In this paper, a total of six chapters, divided into four parts. The first part is the introduction part of the article. In this part, the author mainly introduces the purpose and significance of research background, research, ideas and research framework, the expected contribution and the insufficiency of research methods and research. The second part includes an overview of relevant theories of literature in the second chapter and the three chapter of equity incentive part. Research incentive literature review from the scholars have studied were reviewed and summarized the theory of equity; theoretical overview section introduces the main concepts of the theoretical basis of incentive stock options, equity incentives to develop the nine elements and equity incentive failure. The third part includes the fourth chapter and the fifth chapter. It mainly introduces statistical analysis of the real estate industry equity incentive and the case analysis on the failure of Milord Real Estate equity incentive. The real estate industry the main statistical analysis of equity incentive implementation features, a larger proportion of equity incentive to focus on failure. The fourth part is the conclusion and suggestion, which are studied in the sixth chapter. Suggestions are put forward based on the conclusion of the article. Through the research, this paper the paper argues that China’s real estate companies use the equity incentive ineffective many failures, severe macroeconomic factors and the impact of policies by state regulation while the lack of professionalism in the development of the equity incentive plan, more than a factor set unreasonable.The main innovation of this paper is to put forward the concept of the failure of the equity incentive, and the failure of equity incentive is defined and classified. At the same time, the incentive plans of the real estate listing corporations2006-2013, makes a descriptive statistics, in accordance with the equity incentive model, incentive term, standard source, implementation progress and whether the failure is analyzed, present situation and characteristics of the Chinese real estate listing corporation equity incentive. And with China’s stock market is very representative of the Milord Real Estate as a case, which is according to the numbers of the implementation of equity incentive for every failure analysis, are the implementation of equity incentive in China’s real estate listing Corporation problems.At the same time, due to the limitations of time, the number of studies and the author of the research level, there are still many shortcomings in this article where there are still a lot of things need to continue to study and solve problems. To the equity of the real estate industry incentive for descriptive statistics, because the sample size is too large, the specific implementation announcement failed to read every equity incentive plan, statistical data can only reflect part of the equity incentive, for statistical information and non-quantitative factors of concern is not enough. This paper studies the issues related to the failure of the real estate equity incentive, given the probability of failure on our equity incentive larger capital market, future research could try to apply the concept of equity incentive failures to other industries equity incentive failures. It is in order to help domestic enterprises make better use of the equity incentive to provide additional implementation guidance.