The Empirical Research On Listed Company:Focus On The Enquity Incentive,Managerial Power And Cash Dividend Payout

Under the modern enterprise management system,the management style of separating the ownership and governance gives birth to the principal-agent problems,it becomes more seriously to control as the increasingly developed capital market.As a major disguised compension management method,equity incentives are widely used to solve the agency problems and relieve the interests contradictions between the owners and business operators?It always had been called to the "golden handcuffs" all over the world which awarded by business enterprise.The entrisinc quality of equity incentives is granted some eligibal executives a proportionate number of target company's stock right those can be exercised under certain circumstances.On the help of this system,people in one business can realize a harmonious status refers to owners and executives could demand a surplus value together so as to set up a consistent closely relationships between them.However,the exposures of financial scandals among the American well-knowed enterprise like Enron,Worldcom and Arthur Anderson bring the called "golden handcuffs"into a target position of public criticism.People turn to calm down gradually and to re-check the efficiency and safety of equity incentives.Then after that,the US Citigroup and Microsoft declaired to give up the equity incentive paln at pubilc occasions.Dell also reduced the number of stock options in bulk.The bill of right of making dividend distribution policy is owned to the board of directors,then they should submmit the proposal to shareholder's meeting for approval or not.During this procession,there should not intervened by executives.However,on the one hand,the existance phenomenons of "Owners absence"and "Insider control"in our domestic state-owned enterprises,shareholders actrually have lacked of the control power on the management of investments and cashflow usages.On the other hand,the nature of family business network in NATURE company increased the executives' ability for bargaining towards business owners.Therefore,no matter in the state-owned companies or NATURE ones,there are both have too much stronger managerial power.People who have the stronger power also in a higher position,they are entitled to affect or make any self-interest decision about cash dividend policy directly.They are playing two different but both important roles when dicussing the dividend policy in conference.One is the owner of managerial power,the other is beneficiary whio can received interest in policy.As the different method which were aimed at to resolving the principal-agent problems,the equity incentive and cash dividend policy,which are both related to the distribution of surplus value in business.But they have the different and separated service object.The one are those administrators who are responsible for the business daily operation,aother are shareholders who have the ownership of business equity and control rights for assets.This phenomenon results in a templated motivation of using the complexity on roles to get more returns.Because of this condition,administrators are both the benefiary and decision makers,this arises a worry about if the managerial power is too strong to control.Based on the Chinese special economic and institutional background,this paper proceeds according to the related theroy such as dividend agency cost theory and optimal contract theory.Aimedto analyse the relation among the equity incentives,managerial power and the dividend payout.During the above process,the paper chooses the multiple linear regression method to empirical test the relationship among these three factors.The paper found that:(1)Compare to the non-equity incentive companies,the equity incentive companies has a lower cash divident payout rate.(2)Compared to other equity incentive mode,stock option has a more closely negative relation.(3)In the listed companies,the greater the managerial power,the lower the cash dividend payment level(4)Those listed companies with the greater managerial power are featured of a ralatively faster scale of desease after the implementation of enquity incentive.In conclusion,both the enquity incentive and managerial power can lead to a lower cash payout level in a corperation.Especially in a enquity incentive company,lower cash payout level is accompanied with giant managerial power.They are live with each other.And writter wrote:Enquity incentive likes a moivation,managerial power likes a capacity,and the cash payout policy is a way to achieve one objection while there has been caused an un-efficient consequence.