Executives Characteristics,Equity Incentive And Corporate Investment Efficiency

Investment activity is an important business management activities,the level of investment efficiency is vital to whether the enterprise value objectives can be achieved,and directly impacts on the interests of shareholders.Under the environment of modern enterprise system,there are some serious agency problems caused by conflicts of interest between shareholders and management of domestic listed companies.Such agency problem will have a negative impact on the investment behavior of listed companies and maybe bring losses to the enterprise.In order to alleviate the adverse effects of agency mechanism,domestic listed companies gradually introduced equity incentive mechanism.The choice of stock option incentive can influence the capital and asset investment decision of the senior management of the company,and the investment decisions are undoubtedly important for earnings growth,sustainable management and the development of the company.Therefore,it is of great practical significance to study the relationship between the equity incentive and the investment efficiency.In addition,this article also discusses how the characteristics of executive management have an effect on the investment efficiency of enterprises.Equity incentives influence the investment efficiency by motivating corporate executives' behavior,and the behavior of executives is obviously affected by the background characteristics of executives.Can equity incentives influence the relationship between executive features and enterprise investment efficiency? Therefore,this paper further discusses the effect of equity incentive of Chinese listed companies from the perspective of executive characteristics.Based on the above reasons,this paper studies the impact of executive features and equity incentives on the investment efficiency of enterprises through the combination of normative and empirical research methods.Normative research mainly introduces the design motive of the stock incentive,and expounds the governance effect of the senior management characteristics on the investment efficiency of the enterprise.The empirical research takes A-share listed companies in China from 2010 to 2015 as samples,and residual values are obtained from the Richardson investment model regression.Finally,the conclusion is drawn and the policy recommendations are given.The main conclusions in this paper are as follows: There is a significant negative correlation between equity incentive and inefficient investment;the average age of senior executives and the average term of service is negatively correlated with the inefficient investment;large-scale executive team will lead to the increase of non-efficient investment;equity incentive can effectively inhibit the characteristics of executives on corporate investment efficiency.The research shows that the implementation of the equity incentive plan is beneficial to improve the investment efficiency of the enterprise.In addition,based on the classification of enterprises' nature,the implement of equity incentive is more important in the private listed companies compared to state-owned enterprises.