The Research On Optimization YGSOFT INC's Equity Incentive

Equity incentive is a kind of long-term incentive and restraint mechanism. This mechanism is carried out through granting or transferring the operators some of the enterprise shares so as make them connected to the benefits of shareholders and take the equivalent risks. Originated in America in the 1950s, equity incentive system now is regarded as an important solution to enterprise principal-agent problems and a powerful tool to form common interest between operators and share-holders in countries like Europe, US and Japan, which are featured with mature capital markets. Because our market economy is transformed from the planned economy, so the development of the equity incentive is special to some extent. As the macro environment of equity incentive is gradually improving, equity incentive has become the salary incentive measures which many enterprises want to choose.In this essay, the fundamental types and characteristics of existing equity incentive are summarized through introducing and analyzing the basic concepts of equity incentive system. The actual condition of YGSOFT INC is combined based on the principal-agent theory, incentive theory, human capital theory to analyze the performance after the implementation of evaluation, then put forward the problem of equity incentive, and conclude the corresponding suggestions.YGSOFT INC is a high and new tech enterprise that is centered on human capital and technical capital. To improve the equity incentive plan and enhance the effectiveness of plan, reduce the blindly use and side effects of the plan, has both practical and theoretical meaning for high tech companies to further expand the application range of equity incentive system and promote their reform process.