The Relationship Between The Equity Incentives Of Listed Companies In China And The Performance Of The Enterprises

The emergence of equity incentive mechanism has effectively alleviated the principal-agent problem in corporate governance.China's equity incentive started in the period of reform and opening,and it is still in its development stage.Between January 2006 and December 2016 for 11 years,China's A-share market listed companies participate in the equity incentive the implementation of A total of 693 enterprises,the implementation of A total of 951 times,the number of restricted stock incentive total of 595 times,number of stock options incentive A total of 341 times,stock appreciation rights incentive A total of 15 times.By A-share companies in China,study shows several problems existing in the process of the implementation of equity incentive,including the capital market is not sound,supporting policies fall behind,a sound professional manager market and the external constraint and supervision are lack.The study of the effect of equity incentive on enterprise performance in the present situation is beneficial to the development of equity incentive system.In this paper,it is firstly illuminated concepts related to equity incentive including the definition,the reform mechanism,the development of A-share companies,the problem it faced with and the analysis of this mechanism.This paper also choose 68 companies participated in the equity incentive with financial data completed in the A-share market in 2014 as the research sample,and select their financial data of five years from 2012 to 2016 as variables.The selected alternative corporate performance indicators in this thesis are not single index,but multiple index which chose from companies' abilities in the four aspects including earnings,growth,solvency and operation ability.By factor analysis method,comprehensive index and four ingredients are obtained of profit,growth,debt and operation.When the comprehensive index and the four ingredients are taken respectively as explained variable,equity incentive levels the explained variable,equity concentration,the asset-liability ratio,the enterprise scale and executive pay as control variables,the panel model is set up.By regression analysis,the equity incentive level of A-share listed companies has positive effect on the comprehensive performance of the enterprise and four aspects of company's abilities.Restricted stock incentives are more effective than stock options.Through the analysis of industry regression analysis,it is found that there are differences in the impact of equity incentive on thecomprehensive performance of enterprises and the ability of various aspects.Lastly,the author proposes measures to deal with the development of equity incentive in China combining the theory and practice.