Is There An Opportunistic Behavior In Equity Incentive ?

Since January 1st,2006,China Securities Regulatory Commission has promulgated "Measures for the Administration of Equity Incentives for Listed Companies".More and more listed companies began to implement the stock option incentive plan.To solve the problem of principal-agent,it effectively associates the company's performance with the manager's reward,which can contribute to the company's long-term development.But in the case of information asymmetry,managers with information superiority may obtain relevant information before the company implements the stock option incentive plan.Through the hands of the power,the disclosure time can be influenced.They reduce the exercise price and maximize their own interests.In this paper,Beijing Shuanglu Pharmaceutical Co.,Ltd.is the research object.It based on rational economic man hypothesis,principal-agent theory and management power theory.Let's study the opportunistic behavior of management in the equity incentive plan.This paper uses the event study method,we analyze the cumulative abnormal return in the window to determine whether there is an opportunistic behavior in the implementation of the equity incentive plan.Secondly,it analyzes the characteristics of earnings information disclosure and the reasons for the change of accrual profit.Through the study of the target case found: there is an opportunistic behavior in the implementation of the equity incentive plan.The management disclosure information by the timing,as well as launch of equity incentive plan at a lower price,etc.Thereby they reduced the exercise price of stock options to seek high profits.In view of this finding,this paper from the corporate governance,exercise the price of the formulation of the proposed point of view,to improve the equity incentive system.