Equity Incentive Termination And Resetting Behavior Research

As in recent years, the behavior of listed company equity incentive is increasingly widespread and important, while the equity incentive terminating behavior is gradually increasing too.This paper reviews the determining factors of China’s listed companies to terminate the equity incentive plans and the influence of terminating the equity incentive behavior to the company’s agency costs.This paper also analyzes the feasibility of Chinaese listed companies’resetting equity incentive terms and gives some advises to the relative institutional designment.The empirical research shows that:(1) the downturn of stock market index is the main external cause of the listed company’s equity incentive plan termination; in addition, the shorter the time of the listing, the easier the termination of equity incentive. (2) Although the implementation of equity incentive’ effection on the agency costs is nonlinear, the termination of equity incentive will significantly increase the agency cost.So this paper put forward the policy suggestion:So this paper put forward the policy suggestion:On the premise of not prejudice to existing investors’ interests, equity incentive resetting should be introduced, so that part of the better performance listed corporations will smooth implementate the equity incentive plan.