Research On Equity Incentive System Of Supor

Since the regulation about listed corporation equity incentive implemented in 2006, more and more listed corporation introduce equity incentive, equity incentive has gradually become an important means to improve the incentive mechanism, improve the level of corporate governance, and promote the realization of strategic objectives. Compared with the western countries, the ownership structure of China’s listed corporation is more concentrated, the control right of the company is actually in the hand of the first major shareholder. With the change of property rights and controlling shareholder, the principal-agent relationship, the corresponding corporate governance mechanism and path dependence is likely to change, which will have an important influence on the design of the contract elements of the equity incentive system. Equity incentive is an important incentive mechanism. The design of the incentive contract has an important role in the long-term incentive. Thus, how to design a reasonable and effective equity incentive system in accordance with enterprise’s own characteristics shows significant meaning to realize the purpose of equity incentive.SUPOR is a familial private enterprise specialized in cooking utensils and small household electrical appliance, which was merged by SEB group in 2007.The property right of the enterprise was changed from private enterprise to foreign holding enterprise, as well as the actual controller. SUPOR had implemented the equity incentive systems both before and after the change of the property rights. The equity incentive systems were implemented in different background of property rights and corporate governance. This paper takes SUPOR as the research object and studies the design of SUPOR’s equity incentive system on the basic of the background of the designation and implementation of equity incentive systems. We analyze the motivation and purpose of SUPOR’s equity incentive systems and seek the evidence of the influence of the designation equity incentive systems made by property right. In the end, we analyze the implementation effects of equity incentive systems in different property right.In this paper, conclusions drawn through the case study are as follows: (1)Property right is the basis of stock incentive system design. The change of property right is often accompanied by the change of the controlling shareholder. Different controlling shareholders have different business objectives and development direction, who will influence the designation of the company’s equity incentive, and reflect in the equity incentive system in the end. (2)The designation of equity incentive system should accord with the characteristics of itself. The design of equity incentive system must consider and match the characteristics of the industry, life cycle, growth and other factors, which is particularly reflected in the incentive mode, incentive object, incentive period, incentive conditions, etc.. (3) Equity incentive system should be fused with corporate strategy, corporate governance, human resources policy, supervision mechanism and other management system integration.The innovation of this paper are as follows:Under the condition of non literature research on the difference of the equity incentive system between private corporation and foreign holding corporation, the paper select SUPOR as research object and compare the equity incentive system designed in different property right. The paper finds the difference of motivations and elements in equity incentive system designation under different property right, which offers direct evidence of the influence of the property right on the designation of equity incentive system.This paper is expected to provide scientific and reasonable guidance for the listed corporation on how to design appropriate and effective equity incentive system in accordance with environment and situations. This paper intends to offer reference for the equity incentive designations of different industries and improve the effects of the equity incentive and provide advice to the benefit of the stakeholders to evaluate the rationality of the equity incentive system.