A Study On The Motivation And Effect Of Equity Incentive Implementation

Today’s corporate ownership is separated from operating rights.The conflict of interest between the owner and the operator and the existence of information asymmetry have caused the principal-agent problem.Came into being.Equity incentives can not only suppress the principal-agent problem,but also attract and retain talent,and improve corporate performance and value.This article selects Supor as a case,and attempts to provide a valuable reference for China’s listed companies to implement equity incentive plans through case studies.This article first sorts out relevant literature on equity incentives at home and abroad,then makes a detailed introduction to the meaning and theoretical system of equity incentives,and lays the theoretical foundation for the case study of this article.Secondly,this article briefly describes the implementation of equity incentives by listed companies in China.It is found that more and more listed companies in China have launched equity incentive plans,and they mainly use two types of incentives:stocks and restricted stocks.Next,this article introduces the situation of the Supor Group and its previous incentive plans in turn.The motivations of the four incentive plans are divided into two stages: private enterprises and foreign holdings according to the nature of the company.Welfare motivation,the stage of foreign investment holding is to ease the agency problem,stabilize the talent team and expand market share.Then compared the elements and contents of the four plans,it was found that the scope of incentive objects has been continuously expanded,the number of grants has been gradually increased,the exercise conditions have become increasingly strict,and the exercise price setting has become more reasonable.Then,this article analyzes the effect of incentives from financial performance,non-financial performance,and short-term stock price fluctuation effects.It was found that after the implementation of the incentive plan,Supor’s financial performance has improved,and the core talent team is relatively stable.At the same time,it has also absorbed a lot of high-quality talents,the staff structure has been optimized,the level of corporate innovation and investment has improved,but the short-term stock price fluctuation effect was not obvious.Finally,this article evaluates Supor’s implementation of equity incentives.It believes that there are three successes in the design of the scheme,which are closely combined with the actual situation of the company,the scope of the incentive object is continuously expanding,and the intensity of the incentive is continuously increasing.There are two inadequacies in the formulation of the right price,and then on this basis,four suggestions are proposed: timely adjustment of performance indicators,reasonable determination of exercise conditions and exercise prices,and appropriate extension of the validity period of the incentive.