TITLE:
An Empirical Study on the Effects of Equity Incentive of the Listed Corporations in the SME Board of China —An Empirical Analysis Based on the View of Earnings Management
AUTHORS:
Lixin Xu, Wenqin Cui
KEYWORDS:
Equity Incentive; SME Board; Company Performance; Earnings Management
JOURNAL NAME:
Technology and Investment,
Vol.5 No.1,
February
17,
2014
ABSTRACT: Currently, most researches are focusing on Shanghai &
Shenzhen exchange, and few researches have been done on the SME board. Besides,
while studying the effect of equity incentive, most of the researchers have
ignored the earnings management triggered by stock ownership incentive. This
paper takes the SME board companies which have implemented stock ownership incentive
as the research object. We have used earnings management to modify the company
performance and carried out an empirical research to study the effect of stock ownership incentive.
Our result shows that without earnings management to modify the
company performance, stock ownership incentive is
positively related to company performance. Taking the
earnings management into account, the positive correlation relationship between
stock ownership incentive and company performance will be weakened, and
stock ownership incentive will stimulate earnings management.