An Study On The Effect Of The Share Based Payment On The Performance Of Companies

The biggest characteristic of joint-stock enterprises is the separation of ownership and managerial authority of enterprise. In order to enable enterprises to better operation, business owners will hire managers who have the professional knowledge of enterprise management. The principal-agent relationship is formed between them. But the relationship has also led to many problems, For example, the inconsistent information in the aspect of interests and information. Share based payment system was born in this background, it is able to tie the interest of managers and the interests of the company together, then the incentive objects will comprehensively consider the long-term interests of the company when making decisions, and strive to improve the performance of the company.Our country began payment on shares from the twentieth Century 90’s. Although late, but in less than ten years, share based payment system has obtained the vigorous development in Chinese. The WIND database shows that, by the end of 2012, the number of shares of listing Corporation in China has reached 383. Under the special institutional environment of China, Is the share based payment helpful to improve the performance of the company? What kind of share based payment ratio is the best choice of listing Corporation? What kind of stock payment is the best choice of the listing Corporation?This paper selects 283 listing Corporations which carry out share based payment between 2010-2012 as the research sample, use the principal-agent theory, human capital theory, double factors incentive theory as the research foundation, to make an in-depth study on the relationship between share based payment and performance of the company.First of all, using the descriptive statistics, from four aspects including company quantity, industry distribution, stock payment proportion and stock payment, to summarize the status of Share based payment in our country, and find out the problem, then laying the foundation for the following empirical research.Secondly, this paper will use "paired samples T test" to compare the company performance of 2011 with the company performance of 2013, and to verify whether the implementation of share based payment is helpful to improve the performance of the company.Thirdly, this paper will use "multiple regressions" to analysis the relationship between share payment proportion and company performance. The model is established by regression analysis. The dependent variable corporate performance, stock payment ratio is the dependent variable.Finally, using "independent samples T test", to compare the performance of The implementation of the stock option with the performance of The implementation of restricted stock, to determine what kind of share based payment way have higher performance.According to the empirical results, we can obtain the following conclusions:The first, the implementation of share based payment system can effectively solve the problem of trust between managers and owners, and help to improve the performance of the company. The second, share based payment proportion and company performance exist curvilinear relationship, when the stock payment ratio is less than 3.067%, the higher the proportion of share based payment, the lower the firm performance is, this is because the agents pursuit the maximization of individual interests, breach of privilege can reap more benefits. and when the payment for shares is more than 3.067%, the payment for shares proportion and the company achievements have significantly positive correlation, because if the agent can effectively improve the corporate performance, they can not only obtain higher returns from incentive, also can realize its social value. The last, the effect of executive stock option is better, its performance is better than the implementation of restricted stock. This is because the stock option income depends entirely on the future price rise, only to improve the company’s operating performance, stock prices will be rising, the agent can benefit from it, and the restricted stock income depends on the difference between the intrinsic value of stock and the awarded price, as long as the agent to complete the required performance objectives, and the stock price does not fall below the discount price, they can Gain profit.In view of the above conclusions, this paper also provides the effective suggestion for the shares payment of the listing Corporation.