The Research Of Equity Incentive In China’s Private Listed Company

The modern corporate governance structure is one of the most striking characteristics of the separation of two rights, resulting in the principal-agent problems. In the international capital market, equity incentive has got widely attentions and been considered as an effectively way to reduce principal-agent cost, promote the enterprise performance improvement, avoid frequent flow of enterprise personnel and reduce the executives for short-term behavior, etc. In China, because of the special equity structure and corporate governance structure, the principal-agent problems of private enterprises have become increasingly prominent. After reform of non-tradable shares, the constant perfection of relevant laws and regulations in our country, more and more private listed companies choose to carry out equity incentive. Based on the above background, the research of private listed company equity incentive plan is of great significance.In this paper, based on the principal-agent theory, human capital theory, incentive theory and combined with the background of the equity incentive system in China, firstly explores whether the implementation of equity incentive is helpful to improve the business performance, then from the angle of equity incentive plan design to find out the way of equity incentive factors to affect the implementation of equity incentive effect design, and finally with the example of Wangsu Science & Technology Co., Ltd. to make demonstration of the empirical results. Based on the private listed companies that firstly implemented the equity incentive among 2009-2013 as the research objects, through empirical research found the following results:(1) compared with those failure to implement equity incentive private listed complies in the same industry and scale, after the reform of non-tradable shares the performance of these private listed companies who implemented equity incentive is much better than before; (2) from the perspective of equity incentive plan design, in the process of building model, joined the company size, growth level, capital structure, cash flow and equity balance degree control variables found that grant number has negative correlation on equity incentive effect while the performance indicators of line and incentive period have significant positive influence on the effect of equity incentive.On the results of the study put forward the following suggestions:(1) private listed companies can combine their own actual situations to launch appropriate equity incentive plans, which can effectively improve enterprise performance and make corporate governance structure and financial structure standard, etc. (2) private listed companies should combined with the actual situation, scientific and reasonable make various equity incentive plan elements, such as improving the performance indicators and reasonably increase term of validity to implement equity incentive effect;...