Institutional Environment,Incentive Equity And Share Dividend

On January 1,2006,Equity Incentive Measures for Administration of Listed Companies came into operation,which signals Equity Incentives of Chinese listed companies have officially launched.Taking the listed companies that implemented equity incentive plans from 2011 to 2015 as study subject,this paper analyses the relationship of equity incentive plans and share dividend.The results show that the level of share dividend is significantly higher in the companies implementing equity incentive plans than in the counterpart companies.In state-owned listed companies,the implementation of equity incentives does not have significant influence on share dividend.In non-state-owned listed companies,it has a positive impact on the level of share dividend.In the region with higher marketization progress,the implementation of equity incentives does not have significant influence on share dividend.In the region with lower marketization progress,it has a positive impact on the level of share dividend.Based on empirical analysis,it can be concluded that shared dividend policy has a positive market reaction,which trigger self-serving behavior.Management utilize power to influence share dividend policy for more benefits from equity incentive.Taking political promotion into account,management actively constrain self-serving behavior.In addition,higher marketization progress improve governance environment of companies,thus weaken self-serving behavior of management.