The Design And Application Effect Evaluation Of The Roll-Type Equity Incentive Plan In KPC

Because the imperfect of external market environment and internal operation mechanism in our country, the development of the equity incentive in our country from theory to practice is relatively slow. Until 2006, the new "company law" and "securities law" of the formal promulgation and implementation makes the further reform of non-tradable shares. The improvement of the equity incentive related legal environment makes on the implementation of equity incentive system to eliminate obstacles. Although in recent years more and more companies carried out equity incentive, but also gradually appeared in these equity incentives. Roll-type equity incentive in KPC has a more outstanding performance than other companies in the same industry which has also implement equity incentive.KPC launched a total of two equity incentive plan. The twice plan linked seamlessly, the second plan in general is a continuation of the first plan. In the design of the equity incentive plan, KPC has doing a lot of work, Chose the rolling restricted stock incentive mode, on the design of the equity incentive many elements into the dynamic evaluation, increase the uncertainty of each element of the equity incentive, and adopted the rolling awarded to unlock, make us feel novelty. Based on KPC as the research object, this paper first to the general situation of the company and industry development trend and company equity structure, control environment and staff and pay policy is presented, and then rolling on the company equity incentive plan has made the detailed description, and then based on the description of the company rolling with the equity incentive plan design reasonable applicability at the final rolling through the company after the equity incentive plan is to implement the change of performance and the market reaction two aspects to analyze the effectiveness of the company equity incentive.In this paper, we draw the following conclusions through the case studies:the design of the roll-type equity incentive plan in KPC has a lot of different factors from most restrictive equity incentive plan. First of all, on the model chosen repurchase suited to the characteristics of the growth of restricted stock incentive; Secondly in the conditions for granting and performance unlock on the dynamic dual index evaluation mechanism; Finally extracted in stock sources adopted the company stock financing and incentive object self-raised equal proportion of funds as repurchase shares of sources of funds from the secondary market repurchase its own shares, stock funds but also adopted a progressive extraction mechanism in stages. Kunming group of rolling design of equity incentive is a scientific and reasonable and rigorous design scheme, carrying out equity incentive, up and down in the design not only can achieve perfect the internal governance structure, strive to motivate executives target, pay more attention to the long-term goal of enterprise, to overcome the restricted stock incentive plan the disadvantage of impact on the company’s share price is not enough, more conducive to long-term and stable development of enterprises. Then in order to further verify the KPC rolling the validity of the equity incentive plan implementation, this article from the implementation of equity incentive after change of two-sided market reaction and company performance appraisal. Studies have shown that KPC rolling equity incentive than other companies in the same industry the implementation of equity incentive has a more outstanding performance in the company’s performance.In this paper, the conclusion was based on the study of equity incentive in KPC. This conclusion has important reference value to the listed company equity incentive program design and improving the effectiveness of equity incentive program.