On the Implementation of Medium and Long Term Incentive in State-Owned Enterprises

Abstract

The medium and long term incentive system is an effective incentive system for the long-term development of enterprises in the future. This mode achieves the purpose of long-term development of the company by giving the relevant income rights to incentive objects. On the one hand, the long-term incentive makes the incentive objects pursue their own interests to maximize, improve efficiency and increase the value of the company; On the other hand, it can restrict the exercise of executives, and the exercise conditions in line with the actual situation of the company can better promote the long-term development of the company. The medium and long term incentive system makes the stimulated and the enterprise become a whole to some extent, sharing risks and interests. China's research on the medium and long term incentive system is relatively late. In the current situation of China, this paper attempts to explore the selection and implementation of long-term incentive measures, and put forward suggestions for China's state-owned enterprises to implement the system, so as to better improve the corporate governance structure and enhance the competitiveness of enterprises.