The Incentive Effect Of Stock Option On Innovation

The central government clearly put forward to promote the supply side of the structural reform as a breakthrough and focus on China's transformation and upgrading,to turn the factor-driven into innovation driven,to promote economic stability and sustained growth.For enterprises,the key technology is the core competitiveness.Technology innovation relies on the company's core employees.With the accelerating technological progress,competition between enterprises,between the products is actually the core talented person's competition.In order to improve the enthusiasm of executives and key personnel,effectively combine the interests of shareholders,the company and the operators,so that all parties concerned about the long-term development of the company,China Net Center has implemented five stock option incentive programs from 2010 to 2016.In order to explore the effect of the equity incentive plan and its incentive innovation in the high-tech industry in China,we takes the network technology as a case study.According to the announcement of stock options issued by the company,in this paper,we focus on the relationship between stock options and innovation.In this paper,based on the agent theory,contract theory,human capital theory and innovation theory,combined with the existing literature research,we mainly illuminates the mechanism of stock option to improve innovation ability.Some incentive factors will also affect the enterprise innovation.Through the grant of non-executive stock options,set a longer valid period and the way of option exercise,China Net Center can effectively improve the employee's risk tolerance,sort and retain talents.The company can also reduce free riding and promote teamwork through design evaluation conditions.So as to promote the innovation activities of enterprises and realize the win-win situation between employees and enterprises.Finally,combined with stock option incentive plan,this paper argues that in such aspects as performance indicators design remains to be improved.The application of index options can more fair reflects the efforts of the staff,to play a better incentive effect.