The Influence Of Employee Stock Ownership Plan To The Value Of Jilin Aodong Pharmaceutical Group Co.Ltd

Employee stock ownership plan is a special form of the ownership distribution of the company. Relative to the management equity, staff widely held shares often can further enhance employees’ sense of belonging, improve staff’s work enthusiasm, which becomes the west company widely used way of equity incentive. In the 1980s, some Chinese companies began to implement employee stock ownership plan. In 2014, however,’The Guidance of the Pilot Project on Listed Companies’ Employee Stock Ownership Plan’ promulgated by China Securities Regulatory Commission has set up a new round of boom; In the first half of 2015, there was nearly 200 companies in China launched their Employee Stock Ownership Plans.Along with the widespread implementation of employee stock ownership plan of listed companies, these issues research seems particularly urgent as follows:whether the employee stock ownership plan affect the value of the company, how to get the effect direction and To what extent, as well as employee stock ownership plan is how to affect the value of the company. While in western countries, the majority of employee stock ownership plan had a positive impact on the value of the company and some academic literature supported this view from the aspects of empirical evidence. However, the implementation of employee stock ownership plan effect will be affected by the institutional environment and implementation plan. The Chinese scholars Wang Jinbin, Su Fangguo and Cai Rui found that employee stock ownership plan had no significant influence to corporate performance; Part of the foreign research also found that employee stock ownership plan had short-term promotion effect for performance, which weren’t significant in the long term. Scholars at home and abroad have a inconsistent conclusion and the change of China’s institutional environment which makes the current research on these issues more necessary. Because the case study will help us understand the main variables between the process and mechanism Therefore, this paper adopts the method of case study to make Jilin Aodong which implement the employee stock ownership plan for nearly 20 years compared with the same industry Tonghua Jima.The results of this report shows that:(1) Jilin Aodong’s employee stock ownership plan shows the positive effect to the value of the company no matter from the short-term performance or the long-term performance. (2) Jilin Aodong’s employee stock ownership plan significantly improves the corporate governance and reduces the agent cost of the company. (3) Jilin Aodong’s employee stock ownership plan will help the company control operating costs and improve the company’s gross margin. (4) Jilin Aodong’s employee stock ownership plan promotes to adopt a prudent financial strategy and business strategy and reduces the risk of the company.This paper provide some empirical evidence to support the implementation of employee stock ownership plan for listed companies. At the same time we find the inner mechanism of the employee stock ownership plan mechanism effect on the company theoretically, which can help find the focus on the companies has been implemented the employee stock ownership plan and also can provide investment for the listed company’s stakeholders.