Research On The Effect Of Equity Incentives In Large Central Enterprise

At the beginning of the birth of joint-stock companies,the purpose is to meet the efficient allocation of social resources,to concentrate resources and capital in one place for overall operation management,operation and production,so as to obtain profits.However,with the continuous development of the company,professional managers are born,and the joint-stock owners of the company do not manage the company directly for many times,resulting in the principal-agent cost.In order to solve the principal-agent problem,the actual owner of the company thought of using equity incentive.Use a certain amount of equity incentive to tie the actual managers and shareholders into one boat.Thus,the principal-agent problem is solved to a certain extent,which is also helpful to improve the management efficiency of the company and promote its development.Equity incentive system in foreign countries has experienced a long period of development,can be traced back to the 1950 s.By the 1990 s,roughly 30% of U.S.and European companies had equity incentives.The introduction of equity incentive in China dates back to 1993,when Vanke began to try to use equity incentive plan.Subsequently,more private enterprises began to try equity incentive.Later,a small number of state-owned enterprises began to make corresponding attempts.By 2018,more than 400 listed companies had equity incentive plans,of which only 38 were state-owned enterprises,accounting for less than 10 percent.It can be seen from the data that at present,the equity incentive is mainly carried out by private enterprises in the market,and many large central enterprises have not yet carried out equity incentive.With the release of 《equity incentive guidelines for central enterprises》in2020,the topic of equity incentive for central enterprises in the future will surely become the focus of social concern.At first,this paper sorts out the theories of equity incentive and the literature on the implementation effect of equity incentive in state-owned enterprises.Then it further summarizes the development course of Chinese state-owned enterprise equity incentive system and summarizes the context of the establishment of Chinese state-owned enterprise equity incentive system.Then,combining theory with practice,CHINA STATE CONSTRUCTION ENGINEERING CORPORATION LIMITED,a large state-owned enterprise in a competitive industry,is selected as the object of case study.This paper analyzes the changes of financial and non-financial indexes of CSCEC after the three equity incentives,and makes a comparative analysis through the horizontal comparison between China Railway Construction Corporation Limited and China Railway Engineering Group Limited.Finally,it is concluded that equity incentive has no significant positive impact on the operation performance of central enterprises,and its impact is more reflected in the management risk control and research and development investment.In addition,it also retains important talents for enterprises to some extent.The study of this paper tells us that equity incentive brings more stable factors to CSCEC,and the relevant Suggestions of equity incentive proposed by central enterprises can provide reference and reference for central enterprises in other industries.At the same time,it also provides case support for the equity incentive of central enterprises.