Discussion About Equity Incentive Issues Of A-Share Listed Company In Shenzhen Special Economic Zone

Equity incentive is originated in the late1970s of American. It has beendeveloping rapidly in the80s and90s of the20thcentury. It mainly focuses onsolving the interest conflicts between shareholders and managers and establishinglong-term incentive mechanism to operator. In the1990s, China began to graduallyintroduce equity incentive system. This article analyzes the equity incentive of theshenzhen area A-share listed company, from2005to2013more than300listedcompanies has implemented equity incentive.I use the collected data to makecomparisons of A-share listed companies in shenzhen area.I find that listedcompanies which have completed shareholding reform and f ull circulation have asignificant abnormal returns.Equity incentive is a private enterprise propertyrights.It’s one of the most significant means to encourage professional managers toserve the business.Operator owned, state shares shareholders (state-owned capitalinjection stake) and tradable shares (small and medium-sized shareholders) havedifferent equity incentive effect, The listed company equity incentive managementapproach is based on equity incentive.Taking equity incentive mechanism of A-share listed company in ShenzhenSpecial Economic Zone as the guidance, according to the purpose of theimplementation of equity incentive, combined with th e characteristics of thecompanies in this region, this article discusses the Shenzhen Special Economic ZoneA-share listed company equity incentive problems.This article discusses andanalyses the theory foundation and theoretical basis of equity incentive. In theanalysis of the current situation of the Shenzhen Special Economic Zone A-sharelisted company equity incentive, this article discovers some problems of equityincentive in these companies, and further analyzes related causes of company’sequity incentive problems. Finally, through theory and empirical research es on theequity incentive problems of Shenzhen Special Economic Zone A-share listedcompany, this article comes to conclusions that the implementation of equityincentive in Shenzhen Special Economic Zone A-share listed company stimulates theimprovement of corporate performance, and puts forward the relevant equityincentive policy suggestions, including perfecting local regulations and supportingmeasures that are related with equity incentive, achieving the promotion of equityincentive valuation from the multi-level capital market, establishing a scientific and effective equity incentive evaluation system, perfecting the mechanism ofequilibrium and taking flexible way of equity incentive, etc.