Employee Stock Ownership?Industry Characteristics And Enterprise Innovation

In June 2014,China Securities Regulatory Commission issued the“Guidelines on the Pilot Implementation of the Employee Stock Ownership Plan for Listed Companies",The promulgation of the guidance is an important turning point in the development of ESOP in China.The new round of ESOP is essentially different from the traditional ESOP,which mainly aims at internal fund-raising.Employee stock ownership plan is to make employees become shareholders of enterprises,share risks with enterprises and share benefits.”Man,is the foundation for enterprises to settle down,and employees with subjective consciousness are the core driving force for enterprises to carry out innovative activities.Employee behavior plays an important role in enterprise innovation..A reasonable team incentive mechanism can theoretically provide motivation for employees' innovative behavior.In addition,considering the basic national conditions and macroeconomic background of our country at this stage,scholars in the field of economics have basically unified their opinions,that is,the traditional extensive mode which only depends on the input of capital,labor and energy can not bring about long-term sustainable development of the economy,and the innovation-driven mode of economic development will help me to maintain it.The sustained economic growth of our country is imminent.The formation of innovation-driven economic development mode is inseparable from the R&D and innovation activities of individual elterprises.Therefore,as a team incentive program,whether ESOP can promote R&D and innovation activities of enterprises needs our great attention.Because the implementation time of ESOP in China is relatively short,the existing research mainly focuses on the role of ESOP in western countries and the announcement effect of our ESOP.Based on the existing literature,the effect of ESOP on enterprise innovation has not yet formed convincing conclusions.Therefore,it is particularly important to study whether ESOP can effectively promote enterprise innovation in China.By choosing A-share listed compaPies in Shanghai and Shenzhen stocks during 2014-2018 as study sample,and using the number of invention patent applications as a measure of enterprise innovation,we examined the impact of employee stock ownership plans on corporate innovation activities.What's more,we considered the influence of the degree of competition and prosperity of different industries.The study found that the employee stock ownership plan can significantly promote the company's innovation activities.This kind of effect is more significant in enterprises with higher industry competition than those with low industry competition.It is more prominent in enterprises in the booming industry than those in the sluggish industry.Further considering the value of employee stock ownership and executive stock ownership in employee stock ownership plan,we find that increasing the value of employee stock ownership and executive stock ownership will effectively increase the innovation output of enterprises,especially the value of employee stock ownership.And this promotion effect is more significant for enterprises with high competitiveness and high prosperity in the industry.After the substitution of the agent variable of the enterprise's innovation output into the sum of the three major patent applications,the employee shareholding variable lags in the first phase,and only the high-tech enterprise sample is used for a series of robustness tests,the conclusion of this paper is still valid.The research in this paper not only enriches the research scope of enterprise innovation and employee stock ownership plan,but also reveals the promotion effect of employee stock ownership plan on enterprise innovation.The conclusion of this study provides reliable evidence for the rationality of the implementation of the new round of ESOP policy in China,and also provides reference for the improvement of relevant policies.It can also provide reference for enterprises in different industries to make decisions on whether to implement ESOP or to formulate specific implementation plans of ESOP.