Research On State-controlled Listed Companies’ Restricted Stock Incentives

In September 2008,the State-owned Assets Supervision and Administration Commission of the State Council issued the "Opinions on Regulating the Shareholding and Investment of Employees of State-owned Enterprises" to guide and standardize matters related to equity incentives of state-owned enterprises.After more than ten years of development,significant progress has been made in the reform of state-owned enterprises.The equity incentive plan of the state-controlled listed company has been restricted by strict policies because of its special property rights.Most of them are restricted stock incentives,and scholars have not yet reached consensus on the implementation effect of equity incentives.China Construction Co.,Ltd.(hereinafter referred to as "China Construction Corporation")has implemented the restricted stock incentive plan for the first time since April 24,2013.It has been implemented for three consecutive periods.This article will carry out the design motivation and implementation effect of its equity incentive In-depth research provides a certain reference for other state-controlled listed companies.First of all,the article analyzes domestic and foreign literature,and clarifies the innovation and necessity of research on state-controlled listed companies.Secondly,it summarizes the institutional background of state-owned enterprises’ implementation of equity incentives,then analyzes the policy restrictions and implementation status.On the basis of theory and reality,China State Construction Corporation,a leading enterprise in the construction industry in China,is taken as the case object to further analyze the implementation content of the case company’s successful implementation of restricted equity incentives.The incentives of the implementation of the equity incentive is analyzed through case study methods,combined with internal and external environmental analysis.And then the contract design of its equity incentive plan is evaluated.Finally,it considers the effects of equity incentive implementation from multiple perspectives,including financial and non-financial.By summing up its successful experience and finding its shortcomings,it provides a certain reference for other state-owned enterprises.This study finds that state-owned listed companies are subject to many policy restrictions when implementing equity incentives.On the one hand,these restrictions impose higher requirements on enterprises.On the other hand,they may result in companies lacking initiative and flexibility in formulating incentive plans.The experience of the case study on China State Construction Corporation is summarized as follows: In the design of the plan,the main body of its equity incentives is always the core staff,which is conducive to reducing the rate of brain drain,promoting R & D and innovation,and enhancing the core competitiveness of the enterprise;In implementation,a series of continuous restrictive stock incentive schemes have successfully established a long-term evaluation and incentive mechanism and obtained a good market response.However,the welfare of China State Construction Corporation ’s incentive plan is still relatively strong,with problems such as looser assessment indicators,imperfect index system,and unchanged incentive plans.Based on the case analysis,this paper believes that China State Construction Corporation should strictly evaluate performance indicators,establish appropriate exercise conditions,and establish a diversified performance evaluation system.Finally,from the perspective of the company,some suggestions are made for other state-controlled listed companies that want to implement the equity incentive plan: designing equity incentive plans based on the company’s development level and specific circumstances,in which appropriate exercise indicators and actions need to be selected standards,establish a long-term dynamic assessment system,introduce non-state-owned capital investors to improve the company ’s shareholding structure,and improve the management level of management.