Abstract: Efficiency Contract Theory and Management Power Theory both discuss the relationship between corporate governance and executive equity incentive, but their conclusions are not consistent. In order to verify which theory is more suitable, the paper uses and expands the existing researches to empirically test the impact of corporate governance on CEO equity incentive. The results show that:1) there is an alternative effect between corporate governance and CEO equity incentive, as equity compensation is a corporate governance tool and effective corporate governance can replace the incentive effect of equity compensation; 2) There are three types factors that influence the CEO equity incentive effectiveness:corporate governance intensity, economic factors (such as corporate profitability) and other factors (such as CEO personal characteristics); 3) Strongth of corporate governance is not negatively correlated with economic factors, but there is a negative correlation between degree and equity incentive level. 4) Management power theory is more suitable to explain the relationship between corporate governance intensity and CEO equity incentive. Because the goal of organizational incentive management is consistent with that of CEO's equity return, there is an alternative relationship between corporate governance and CEO's equity incentive. The organization will adjust the equity incentive plan according to the level of corporate governance, such as adjusting the proportion of equity compensation in CEO's compensation structure.

Key words: efficiency contract, management power, corporate governance, CEO equity incentive