| Executive Stock Options (ESO) is a long-term and effective inspiriting mechanism. Its essential character is a sort of compensation arrangement for managers. It takes agency theory as its premise, human resource property right as its core, and modern distribution theory and risk theory as its foundation. Its basic idea is to give high-level managers headed by chief executive officer the right to purchase common stocks of the company at a certain price and time in the future. Through this equity system, it's expected to inspirit organizations' management in the long run, avoid operators' short-term behavior, and thus reduce agency cost, improve organizations' management structure, and promote the stability of management, so that both constituents ( stake holders ) and vicegerents' (operators) targets of gaining profit will be realized finally. This system is a system innovation of applying equity theory into modern inspiriting mechanism. It is a more suitable system to the organization managers' value direction and corporations' strategic requirement in management under the condition of market economy.ESO originated from the US, after over 30 years' development, it is now gradually becoming the main stream in the stimulating systems, and is adopted widely all over the world. In America, it obtains great supports from both macro economy environment and relative policies. Therefore, it develops itself perfectly there. However, comparing with that, this system is at its staring point in China.In this paper, using standardized study, I will compare this system's developing environment between China and US, different phases that the systems are, and the designs of this kind of system, etc. Basing on the analysis of the advantages and disadvantages that this system brings to the US, I will discuss the reason of differences of the system between China and the US, evaluate the situation of this system in China, and discover its existing problems in our country, so that I will find the counter measure to solve the problems, and contribute it to the study in this area in China. This paper consists of six parts: firstly, I will introduce the basic theory ofmanagers' equity stimulation system. The second part is the introduction of the history and current situation of managers' equity stimulation system in both China and the US. Thirdly, I will compare and analyze content of managers' equity stimulation system in both China and the US. Then it comes to the analysis and evaluation of America's managers' equity stimulation system. In the fifth part, I will roughly analyze China's managers' equity stimulation system. Finally, conclusions will be drawn in the end.From the analysis, we can see that on one hand implementing managers' equity stimulation system is one of the important directions of the construction of organizations' inspiriting mechanism and restriction mechanism in China. The development of corporate governance requires urgently adopting widely this equity system. On the other hand, from the macro aspect, we do not possess the condition of carrying out this system countrywide in China. Therefore, according to this situation, I suggest to apply this idea in the form of experimentation in several cities, simultaneously, gradually establishing the framework of relative policies. Thus the environment of implementing this managers' equity stimulation system will be gradually improved, which will ensure the system to work effectively. Finally, popularize this system step by step. With people's acknowledgement becomes deeper, also with the improvement of micro mechanism in China's enterprise and macro economy environment, the introduction of managers' equity stimulation system and its taking into practice will have great positive influence in the integrative revolution of our enterprises in China. |
