Value-based Incentive Compensation Mechanism

Study on the agency theory and incentive theory of domestic and foreign, I established a suit of agent's incentive mechanism for corporate and comprehensive evaluation index system of enterprise value. Not only use the financial indicators to measure the performance of an agent, but also from the perspective of multi-dimensional evaluation of their performance. It will be more objective and more specific, making the interests between the operator and owner convergence. it has important strategic significance for long-term development of enterprises. The evaluation system and incentive system designed to prevent business operators to focus on short-term benefits, ignoring the company's long-term development. As the operators, they can not only get benefits from the normal operation of management, but also share the benefits of growth with the owners. In this paper, the research method is that compared with various incentive programs between domestic and foreign, to analysis their advantages and disadvantages, and get a workable comprehensive evaluation index system; and ultimately established the comprehensive evaluation index system that balanced scorecard and EVA as the main index to assess the performance of enterprise managers, and on this basis, the implementation of stock option incentive plan. In short, I think that operators not only attach importance to short-term interests of enterprises, but also should pay more attention to the company's long-term development. Only in this way, enterprises can get long-term development continuously and healthy.