Research On Yonyou Network Technology Co.,Ltd's Equity Incentive

From 2005 in that time China Securities Regulatory Commission issued?Measures for the Administration of Equity Incentives of Listed Companies?to the end of 2016,there is over 1000 in total listed companies in China launched over 1300 sets of equity incentive plan.In recent years,the number of listed company that implement equity incentive plan has been explosive growth.Why so many listed companies keen to launch equity incentive plan? On the one hand,modern society has been from the traditional human resources age into the era of human capital,human capital is vital to the development of the company.The implementation of equity incentive plan can make enterprises be in an advantageous position in the competition for the talents,and equity incentive has been an effective way to retain and attract the talents.On the other hand,the interests of the executives and core employee are tied to the value of the company by equity incentive plan.In order to get return,the employee incented must work hard to improve the performance of the company to make the stock price rise.From ? Measures for the Administration of Equity Incentives of Listed Companies?launched to the present,equity incentive practice in china has been gone through eleven years.What are the problems in the design of equity incentive? How about the effect of equity incentive? The domestic scholars have conducted a lot of exploration.In the design of equity incentive elements,there exist some problems such as the single performance index,too short incentive validity.In the effect of equity incentive,there is not consistent with the conclusion on the relationship between the equity incentive and company performance.There is a different design of equity incentive for different companies,and the effect to the promotion of company performance is also different.Therefore,the research on the company case is particularly important.This paper choose Yonyou Network Technology Co.,Ltd's three equity incentive plans as the research object.The implementation stage of the three equity incentive plans basically covers the whole stage of equity incentive practice in china,which is a microcosm of equity incentive practice in china.First of all,this paper reviews the literatures about the short-term market reaction of equity incentive,effects of equity incentive and the design of equity incentive elements,and introduces the basic theory of equity incentive.Then,the short-term market reaction of the three equity incentive plans are studied by the event study method,and effects of the three equity incentive plans are analyzed by the comparison of company performance before and after implementing equity incentive plans and paired sample method.Finally,this paper analyzes the design of equity incentive elements and puts forward some suggestions.By the research on the three equity incentive plans,we found that in the short-term market reaction of equity incentive,the stock market had a bad reaction for the first equity incentive plan,but he stock market had a better reaction for the second and the third equity incentive plan;in effects of equity incentive plans,three equity incentive plans have played a certain incentive effect,the effect is better in the first year of the three equity incentive plans implemented especially,but the effect is not obvious after the first year;in the design of equity incentive elements,in the three equity incentive plans,the choice of employee incented and the total number of awarding to employee incented is relatively appropriate,and the choice of incentive model is matched to the strategy of company,but there are some problems in the number of awarding to every employee incented,performance evaluation index and exercise price.