Study On Effects Of YGSOFT INC's Equity Incentive On Enterprise Performance

Since the 1960 s,equity incentives have been sought after by countries around the world and have become an important long-term incentive mechanism for enterprises.After the 1990 s,with the improvement of China's overall macroeconomic environment and the completion of the reform of the shareholding structure,equity incentives have become popular in China.While some enterprises blindly implement equity incentives in order to catch up.In recent years,high-tech enterprises have flourished,and senior management personnel and core technical personnel have become the company's core resources.In order to retain senior executives and core technical talents,the company implements a long-term incentive mechanism of equity incentives.However,there is a certain degree of selectivity for different types of incentive models for different industries and companies,and inappropriate choices may be counter-productive.Therefore,it is necessary for us to study the relationship between the impact of equity incentives and the company performance,so as to reduce the cost of entrusted agency and improve company' performance.After studying the relevant literature of other scholars' empirical studies and case studies,the paper selected three phases of Yuanguang Software,one of companies listed in the Shenzhen Stock Exchange to study its implementation of incentive theory in 2009,2012,and 2014,combining with equity incentive theory,equity incentive model,principal-agent theory and human capital theory.And the paper comprehensively analyzed data with induction analysis method,financial indicators analysis method and Wall method in order to provide further empirical evidence and optimization solutions for Yuanguang Software and other information technology enterprises.Findings: After Yuanguang Software implementing stock option in 2009,the company's performance was proactively improved.While with the completion of the unlocking,the effectiveness ofincentives weakened and the company underperformaned.Then the company's performance has made further progress in 2012 with the restricted stocks and the two factors were positively correlated.However,due to the unreasonable assessment indicators,coupled with the slow development of the overall domestic economy at that time,the equity incentives did not play the expected effect in 2014.Therefore,the implementation of equity incentives should fully consider different growth stages of the company for different incentive models,set reasonable conditions for unlocking and reasonable grant prices,and gradually improve the corporate governance structure.And it is necessary to increase supervision to effectively implement the equity incentives plan.