The Correlation Analysis Of The Equity Incentive And Corporate Performance Based On The Listed Company In Anhui Province

The develop of modern enterprise system inevitably bring about the separationof ownership and management, also produced principal-agent problem. According to"rational economic man" hypothesis, this paper argues that the actual business operatorscomply with the "rational economic man" hypothesis, in the context of this hypothesis,the operator’s business decisions are made in order to achieve their own interests tomaximize, there is a conflict of interest between the operators’maximum benefits and thebusiness owners pursuit of maximum benefits. that means the tend of purit the interestsbetween the operator and the business owners is inconsistent, resulting in principal-agentproblem. In order to maximize their own interests, Business operators will be embodiedin the operator’s moral hazard and adverse selection. it is particularly important for thebusiness owners to choose a effective measures to restrict the operator’s moral hazard andadverse selection, so it is necessary to implement equity incentive system to the operators.Equity incentive is a new management incentive and restraint measures, On the one hand,It does this by the way of agreement to allow the operator get s a certain number ofcompany shares, the company operators by the mere role of an agent into businessmanagers and owners, Finally the company operators and owners form a consistent withthe objectives and interests. On the other hand, as part of the operator’s salary structure’sequity incentive income, the company operators must strive to achieve performancetargets that agreed with the company before they can get during the excitation period, sothat the owners can effectively avoid the operator’s short-sighted behavior, enablingoperators to be more concerned about the long-term development of enterprises. Equityincentive can solve principal-agent problem between the owners and managers, and toachieve the maximization of corporate value.Equity Incentive originated in Silicon Valley at the70-80years of the last century,so far, the incentives of equity incentive are still widely used by U.S. companies.According to the relevant agencies’ statistics,90%of U.S. high-tech companies haveimplemented equity incentive, and achieved remarkable results, while our county islagging behind in the development of equity incentive, in the early1990s, we have thefirst company to trial equity incentive system-Shenzhen Vanke Group. Since then a listedcompany has successively Implemented the equity incentive in China, but it’s rather latefor China’s company that implement the equity incentive, there are still have a lot of special problems, reflected in the following aspects:the capital market is not effective,the construction of relevant laws and regulations are not sound enough, the managermarket is not perfect etc. Based on drawing the successful experience of foreigncountries, Our country’s listed companies also combined with China’s national conditionsto explore and move forward.With the2006"listed company equity incentive management approach (Trial)"(hereinafter referred to as the "management approach"),it opened the big screen of Ourcountry equity incentive. From2005to2011, Our country’s listed companies thatimplemented equity incentive experienced:2005gestation period-2006pilot phase-2007Rectifying and standardizing-2008Mature promotion period-2009developed stage-2010blowout-2011catch-up period. during those period our country’s equity incentivehas been constantly self-adjusting and self-improvement. Compared to other majoreconomic province, Since2006Equity Incentive curtain has opened, the numbers ofcompanies in Anhui Province which implement the equity incentive is Seldom.According to those, this paper selected Anhui Province’s listed companies whichimplemented the equity incentive as the target to study the relationship of Listedcompany’s equity incentive and corporate performance. Designed to reveal a specialequity incentive roads that the regional listed companies took, and give some reasonablesuggestions. This study used descriptive statistics, correlation and regression analysis, theconclusion is: the proportion of equity incentive has correlated with the corporateperformance，the value of equity incentive has significant positive correlation with thecorporate performance，and also the corporate performance was significantly associatedwith capital structure.This article includes five parts:The first chapter introduces this article’s accordance in topics, this study’s practicalsignificance, relevant research trends at home and abroad, and making a brief commentfor the research trends between home and abroad. Along with a brief overview of themain research content, technical route, research methods and the l Possible innovationsand inadequacies.The second chapter describes the basic theory of equity incentives. mainlyintroduces the meaning of equity incentives, the basic theory of equity incentivesincluding Principal-agent theory, human capital theory, incomplete contract theory,transaction cost theory. Equity incentive model is generally divided into stock options,restricted stock, performance shares, stock appreciation rights and phantom stock. The third chapter introduces the analysis of Listed companies in Anhui Provincewhich implemented equity incentive. Describes how the equity incentive effect on thelisted companies’ performance, the policy evolution of equity incentive、the main modeof equity incentive that Anhui companies took.The fourth chapter presents the relationship between equity incentive and corporateperformance, listed companies in An hui Province as samples. Introduced the proposedhypothesis, sample selection, model design and empirical analysis of the situation.The fifth chapter is the end of the article, first summarize the conclusions ofempirical research, and then make policy recommendations on this conclusion.