Study On The System Of The Stock Option

The stock option is the right which the staffs purchase the stock in the future by the prearranged price. It closely links the managers' benefits and their contribution with the future expansion of enterprises. The stock option system is one of the effective encouraging way that adapt to the development of modern enterprises system. It not only can embody the value of managers' human resources, but also can effectively solve the problem of principal-agent in modern enterprises.The stock option system is applied extensively in the west countries. It also received tremendous success and universal acceptance. But there are some realistic obstacles in the promoted process in our country, particularly in regard to the legal system need to constantly improved. In this paper, based on our country's existing law, contact with the legislative experience of other countries, it gives a preliminary discussion stock options for the legal system.The paper includes four parts:Part 1 is the general introduction of stock option system, includes its notion,mechanism of action and legal nature. Over all the mechanism of the stock options is that the operator's return on assets based on enterprise value basis, to maximize the income of operators and enterprises in order to maximize the ability to stimulate the operators. The legal nature of the stock options has two major opinions. By analyzing this two opinions of the stock option, the author point out that the right of the stock option is a special right which present different characters in different periods.Part 2 mainly introduces the theoretic basis of the stock option system and the value of the system, also describe malpractice of it. It is based on the theories of principal—agent, and human capital. The former explain that managers must be stimulated, it is the question of its necessity. The latter explained that managers should be inspirited, it is the question of reasonable. Combination of the both, explained the necessity and rationality of the stock option. The stock option system was once regarded as a right key to the question of principal—agent, so it has developed quickly in recent years and are respected in the enteiprise of western countries. In the meantime, the stock option system is highly risk, so we must recognize the value of the system and its drawbacks.The third part is the focus of the article; the author put this segment into several pars according to the flow or progress of the stock option system. Such as, the rights granted, exercise the rights and the source of the system of stock, Then analyze the current stage of our country's relevant laws and regulations, and put forward the improve views.The forth part has related to the relevant supporting system of the stock option. The stock option system in our country develop healthy depends on perfecting the related laws and institutions. It involves every aspect of the content, which is essential for the implementation of the stock options. It put forward some advices to norm and consummate the system of our country stock option from the tax system, accounting standards, internal governance system and the market system. Thus, the stock option system will eventually play a consistent role in stimulating the company's operators.