Hengrui Medicine Equity Incentive Case Study

The birth of a professional manager system has led to a specialization in company management.However,because the interests of managers and company owners cannot be completely identical,managers may act against the development of the company for self-interest reasons,thereby damaging the company benefits,resulting in agency costs.In order to reconcile the conflicts of interest between managers and owners,motivate managers to better serve the company and stimulate their work enthusiasm,the equity incentive system came into being.At the end of the 20 th century,as China’s shareholding system developed rapidly under the influence of the international environment,China began to introduce equity incentive system.In 2005,the stock market began to reform and China has introduced a series of policies such as the "Measures for the Management of Stock Incentives in China’s Listed Companies" to Regulate the equity incentive system.In 2015,China proposed "mass entrepreneurship,innovation",Innovation is seen as an important way for companies to improve their innovative research capabilities,competitiveness and operating performance.This article takes the Hengrui Medicine’s equity incentive case as the research object,and intends to conduct an in-depth study of the equity incentive effect and provide reference for the listed company to implement equity incentive.Through the use of EVA model,principal component analysis and other research methods,this article takes Hengrui Medicine’s equity incentive case as the research object,and deeply analyzes the impact of Hengrui Medicine ’s equity incentive on the company’s operating activities,overall performance,market reaction and human capital.This article can be divided into six parts.The specific content is summarized as follows: The first part is introduction.This chapter mainly introduces the research background,significance and research content of this article;The second part is related to the theoretical basis and literature review.This section briefly describes the concepts of incentives and equity incentives.Subsequently,the literature on the relationship between equity incentives and corporate behavior was introduced: The third part is to introduce the case of Hengrui Medicine ’s equity incentives.First,it briefly introduces Hengrui Medicine ’s equity incentive case,and then analyzes and explains the motivations of its implementation of the equity incentive plan;The fourth part analyzes the impact of Hengrui Medicine ’s implementation of equity incentives on the company from the perspective of business activities,comprehensive performance and market response;The fifth part is the analysis of the effect of human rights capital on the implementation of Hengrui Medicine ’s equity incentive.The sixth part is the summary of the case and the suggestion.Through the above research,this paper draws the following conclusions:(1)The equity incentive has a positive impact on the improvement of the company’s operating activities;(2)The incentive implementation has had a positive impact on the company’s overall performance;(3)the current equity The incentive market has reflected well;(4)The equity incentive has improved the human capital situation.