Research On Optimization Of Equity Incentive Scheme For High-tech Enterprises

With the transformation and upgrading of China's economic structure,the tertiary industry has been strongly supported by the government,and its driving role in the national economy has been continuously enhanced.Among them,the hightech enterprises have gained a prominent and rapid growth.Since 2015,China's high-tech enterprises that started from mobile phone production have risen rapidly.Beijing Xiaomi Technology Co.Ltd.is a typical representative of this type,which usually has the characteristics of high investment,massive innovation,high risk as well as high return.Since the key to its competitiveness is the core technology and innovative products,equity incentive can help these enterprises retain and motivate the talents so as to improve its core competencies of R&D and innovation.The existing researches on equity incentives in China mainly focus on the effect of equity incentive schemes,while this paper will revolve around the equity incentive scheme itself.This paper first examines the design and effects of equity incentive scheme through collecting relevant literatures.The case study is based on the equity incentive scheme of Xiaomi Company.This paper discusses the motivation and necessity of Xiaomi Company's implementation of equity incentive,and analyzes the content and implementation effect of its equity incentive scheme.Finally,this paper proposes optimization suggestions from two aspects of governance structure and equity scheme for Xiaomi Company,and summarizes the inspirations for other companies which focus on the setting of the vesting conditions and terms,the combination of the incentive mode,the control of the equity incentive scale,and the improvement of the supervision mechanism.