Research On The Effectiveness Of Supor's Equity Incentives

The first generation of entrepreneurs gradually turned into the background in recent years,so more and more companies' owners began to hire professional managers to take care of the companies.Due to this management method,the company's ownership and management rights were separated,and the long-term vision of the two parties was inconsistent.To solve the principal-agent crisis,Chinese listed companies began to imitate the practices of foreign companies and use equity incentives to alleviate this problem,in practice,many companies want to play the role of long-term equity incentives to promote the healthy development of enterprises by choosing a reasonable equity incentive model,setting appropriate thresholds for equity incentives and effectively motivating employees.Supor is one of the typical listed companies.Since its listing,Supor has implemented four equity incentives.During this period,it has made a lot of changes about equity incentive facts.In addition,the nature of the enterprise has changed in 2007.Based on this feature,it can be used as a typical case to explore the impact of equity incentives on corporate market value,operating performance and staff retention.This paper selects Supor Co.,Ltd.as the research object,using its four sets of equity incentive plans released in 2006,2012,2013 and 2017 as research materials,using case study and comparative analysis to study similarities and differences by comparing the equity incentive factors,and then explore the effectiveness of these four equity incentive plans through market response,financial performance,exercise results and other aspects.Finally,combined with the above series of comparative analysis,this paper put forward suggestions for improvement.The analysis results prove that Supor's equity incentive factors tend to be more reasonable-the choice of incentive objects is more extensive,and the exercise conditions are suitable for enterprise,and the exercise ratio is more dispersed.But there are also shortcomings-the exercise price of the next three equity incentives is set too low and suspected of profit transfer.In terms of implementation results,Supor's first two equity incentive market responses were good,and the last two market response was average;in terms of financial performance,profitability has been improved in long term;in terms of exercise results,after the implementation of equity incentive plans,the employee turnover rate has decreased,and the number of high-quality talents has continued to increase,and R&D investment has increased.But there are also some shortcomings-the improvement of the company's growth ability,debt paying ability and operating ability is not obvious.Supor's equity incentive plans provide reference and warning for similar small household appliance companies.First,Supor selected restricted stocks with more balanced rights and obligations;second,Supor enhanced the connection between employee contributions and share acquisition;finally,the incentive object should expand to the middle and technical backbone.At the same time,Supor ignored evaluation indicators other than profitability,and the validity is short,and the existing shortcomings such as low prices also warn other companies.Aiming at the implementation status of Supor's equity incentives,this paper also provides some proposes such as ricing performance assessment indicators,selecting reasonable restricted stock grant prices,and appropriately extending the validity of equity incentives.