listed rival network news Source: Nanfang Dail

Vanke has just released three of the Quarterly Bulletin shows that the year 2008 restricted stock incentive plan to encourage provision of funds for net profit growth rate of over 15% of the performance indicators it is difficult to achieve, the company's executives will be wasted or equity incentives.

Vanke's announcement, another wave of industry executives of listed companies on the long-term incentive issue.

A few days ago, the People's University of China Development Research Center, a modern and international human resources consulting firm Watson Wyatt recently jointly issued the" China Year 2007/2008 executives pay and corporate governance study "showed that only 122 enterprises to implement a long-term Incentives. According to the experience of mature markets in the West, more than 95% of listed companies pay executives, all part of the long-term incentives accounted for a larger proportion. It is clear that the use of long-term incentive to enhance the level of enterprise management's wishes, and not China A-share listed company's general importance.

Private enterprises more attention to long-term incentiv

Study shows that according to their industry, in which 122 companies in 75 manufacturing enterprises, accounting for more than 50%, followed by the real estate and information technology industry, the two industries are 10 enterprises revealed the long-term Incentive plan; from the nature of their enterprises, private enterprises, 67, 46 state-holding enterprises, state-owned enterprises 9.

Meng Nan, deputy general manager of Watson Wyatt in the interpretation of these data, said:" The market is affected by whether or not the introduction of long-term incentive mechanism one of the main factors. As manufacturing and real estate market for many years, after which the operation of the industry , On behalf of the interests of the shareholders of the executives on the board of directors will certainly put forward the corresponding performance requirements. "Equity and long-term incentive plan exactly narrow the gap between executives and shareholders of the connection between the two so that the interests of further convergence.

The results also showed that the implementation of long-term incentive plans listed private enterprises to significantly more than the number of state-owned and state-holding enterprises. Meng Nan explained that the long-term incentive plan will not only strengthen the executive pay and corporate performance of the link, but also to attract and retain qualified personnel incentives, private business-to-long-term incentive plans have stronger demand.

Chicken into long-term incentive?

In the United States and Hong Kong, and other mature markets in listed companies pay executives, all part of the long-term incentive accounts for a larger proportion of A shares, but only 9% of the proportion of listed companies seem to show enthusiasm for the long-term incentive is not high.

Recently, the Wall Street financial crisis swept the world capital market, listed companies stock prices have plummeted, as the executives of the majority of long-term incentive stock options to give way, this also means that stock prices and tied together Incentives designed to stimulate the role is limited, executives have greatly reduced salary, coupled with the upward phase of the extension of the right to delivery, many executives and employees of this form of incentive they worry about making long-term incentive chicken suspected of being successful.

People's University of China Finance and Securities Research Institute researcher Wei-wei should be from three to explain the problem.

First of all, from the market, listed companies on the" executive pay "and" long-term incentive "to use is still in its infancy, it has yet to take shape of the overall market climate.

Secondly, from the enterprise, the implementation of long-term incentive plan also requires" appropriate soil, "If we do not promote enterprise performance-oriented culture, long-term incentive will be difficult to be accepted.

Finally, the long-term incentive from the proceeds of the way, because of their income mainly through access to cash equity, capital markets mature and investors is to ensure the implementation of corporate long-term incentive plan an important condition.

However, Wei should be of the view that although the current A-share market listed companies are not keen on long-term incentive, but as government regulation of business and improving their understanding of the extent of deepening the implementation of long-term incentive may be the future trend will be the host.