Research On The Stock Option Incentive Effects Of Listed Company Managements In China

Stock option incentive on managements is designed to make a shared goal for shareholders and management so as to stimulate the management to work on behalf of the shareholders and society to the fullest. Is it useful in China? What is the short-term impact on the public companies? What factors make a difference on the short-term impact and how do they work? The aim of the paper is to review the stock option incentive on managements in China and analyze its short-term impact after the publication of the approach on stock option incentive of listed companies by China Securities Regulatory Commision.The paper is divided into five major parts:In the first chapter, we introduce the theme, arrangement of the research, and the literature reviews of stock option incentive on managements and so on, from which we can have s simple idea of the whole paper.In the second chapter, we explain the relevance of the concept of stock option incentive on managements and then focus on reviewing stock option incentive on managements theoretical foundation of corporate governance theory, the principal-agent theory, human capital theory, transaction cost theory, two-factor theory.In the third chapter, we introduce the development process of stock option incentive on managements in our country, then analysize Chinese listed companies in the implementation of stock option incentive on managements for the status quo at this stage revealed the Chinese equity incentive environment, as well as some listed companies equity incentive plan shows that our country listing company shares after the equity-based incentives to specific circumstances.In the fourth chapter, in order to share after the change from 2005 to 2007 to implement inter-announcement stock option incentive program, we choose 24 listed companies as the sample, use the measurement software Eviews3.1 regression analysis. Studies have shown that in a listed company with stock option incentives on managements, there is a significant positive correlation between the performance of the company and stock option incentives on managements. It may be due to the followings: settlement of shares for incentive stock problem sources; "Securities Act" on the revision of laws for the state-owned enterprises and shares margin financing provided space for development and innovation; the newly revised "Company Law" in the capital system, repurchase shares and executives during their term of office areas such as transfer of shares has been a breakthrough in enhanced adaptation of listed companies market autonomy and flexibility.The last chapter is a summary of the full paper, and put forward the advice to improve our country's policy recommendations.