The Effect Of Equity Incentive On Innovation Performance Of Enterprises

China’s economy is facing a transition period,and innovation is a key link to promote the transformation of growth mode.As the main body of innovation activities,enterprises’ innovation ability plays an important strategic role in enhancing national economic strength.Under the condition of open economy,enterprises are faced with more intense and complex competition,and the competition mode is gradually transformed from the traditional market competition and cost competition to the talent competition.Attracting,acquiring and retaining high-quality talents has become the key for an enterprise to improve its innovation performance.As representatives of high-level talents,senior executives can influence the decision-making of an enterprise’s innovation strategy to a certain extent.To perfect corporate governance structure,solve the modern management under the background of the two rights separation of principal-agent problems,at the same time inspire executives work enthusiasm,prompt it to better use personal talents,improve the quality of long-term investment decisions,promote enterprise innovation performance,equity incentive as a kind of "incentives" has become one of the many companies preferred incentives.However,according to different research samples and methods,scholars have come to different conclusions on whether equity incentive can improve the innovation performance of enterprises and through which channels it plays its role.Given the current research,this paper selects A-shares listed companies in Shanghai and Shenzhen as research samples,to get involved the measurement indexes of listed company’s overall time span for December 31,2004-December 31,2017,to the distinction between control group and treatment group after samples,and further explores the relationship between equity incentive and enterprise innovation performance by using propensity score matching(PSM)and Differences-in-Differences(DID),and discusses in depth the important role of executive power in it.Through empirical analysis,this paper obtains the following two important research conclusions: Firstly,Whether in the control group or the treatment group,the implementation of the equity incentive plan can significantly promote the improvement of the innovation performance of the sample companies listed in Shanghai and Shenzhen A-shares;Secondly,the promotion effect of equity incentive on enterprise innovation performance can be partially transmitted through executive power,and all the research conclusions have passed the robustness test.Finally,according to the research results,this paper puts forward relevant countermeasures and suggestions for the the executives of enterprises,the listed companies themselves and the regulatory authorities respectively,and summarizes the deficiencies of this research and the prospect of future research.