The Comparative Study On The Equity Incentive Scheme Of Vanke

Equity incentive as corporate management’s important means of long term incentive and constraint receives more and more attention from the theoretical circle and the business circles. The reason is that it can improve the company’s internal governance, promote the management work hard for the realizat ion of "shareholder value maximizat ion" and enhance company value. However, the effectiveness of the equity incentive in the domestic listed companies still exist larger controversy in industry. the industry of equity incentive in the effectiveness of the domestic listed companies are still larger controversy. Shenzhen Vanke Co., Ltd., as one of the forerunners of the implementat ion of equity incentives, so study the equity incentive has certain representative meaning in the process of marketizat ion of our country, while in recent 5 years, Vanke has implemented two times of equity incentives with different results for the different plan, the result is not the same. For Vanke’s two times of equity incentives, the first time is failed for not achieving performance indicators, and the second time achieves the performance indicators, but in less than two years after the announcement of the equity incentive plan, Vanke happened “The personnel earthquake” in its nearly 30 years of history, so it is visible that the desired effect can not reached even the implementat ion of equity incentive. So it has a certain significance in studying the design of the equity incentive plan to give full play to its incentive effect and make listed company achieved its desired goal.This paper is based on the principal-agent theory, incentive theory and human capital theory, focusing on Vanke, to study the impact of equity incentive design on its incentive effect. Firstly, by combing literature of equity incentive, the motivat ion, performance and implementat ion effect of equity incentive are summarized. Then further analyzing impact of two sets of equity incentive plan issued by Vanke in 2006 and 2011 on human resources, business performance, and finally change of the enterprise value, finding its successes and deficiencies we can learn from, and putting forward corresponding modification suggestions to Vanke’s equity incentive, in order to further improve the equity incentive mechanism of the listed company to provide some ideas and methods. This article has five parts totally:The first part is introduction. It expounds the research background, research signif icance, the literature review at home and abroad, as well as the overall idea and structure of the thesis.The second part is theoretical basis. It expounds the theoretical basis of equity incentive for the executives of listed companies, mainly including human capital theory, principal-agent theory and incentive theory.The third part is Vanke equity incentive plan. The issues like basic situation of Vanke and corporate governance structure are introduced in this part, and analyzing the reason why Vanke implement the equity incentive plan in 2006 and 2011, and the main content of the equity incentive plan, as well as expounding the implementat ion results of equity incentive in 2006 and the implementat ion of equity incentive in 2011.The fourth part is case analysis. This section is about the comparative analys is of Vanke’s equity incentive scheme, mainly analyzing from two aspects, the first aspect is performance analysis, by comparing the performances of Vanke before and during its equity incentive with the industry level, to check whether Vanke’s equity incentive has effect, and through the comparison of two equity incentives and industry, to check which effect of equity incentive is more obvious; the second aspect is the analysis of the scheme design, the design of two equity incentive plan is different, this paper compares the different five aspects of the two equity incentive plans, combining the results of the two equity incentive to analyze that different design is suitable for different enterprise, and what results can be lead to the enterprise. This leads to the signif icance of Vanke.The fifth part is the enlightenment and suggestions on Vanke’s equity incentive schemes. This part, according to the analysis of the above parts to draw some inspirations, and putting forward relevant improvement suggestions for the problems existed in the two rounds of equity incentive plan of Vanke.