Case Study On The Equity Incentive Of Yonyou Network

Equity incentives not only ease the problem of principal-agent,but also attract and retain outstanding talents and enhance the company's core competitiveness.China introduced equity incentives in the 1990 s.In December 2005,the promulgation of the “Measures for the Administration of Equity Incentives of Listed Companies(Trial)” marked the formal entry of China's equity incentives into practical stages.Yonyou Network announced the first draft equity incentive plan in 2006.It is one of the first companies to implement equity incentives after the introduction of the pilot scheme.It has implemented four equity incentive plans,with restricted stock models,stock option models and the combination of the two.It can be said that the implementation of the Yonyou Network equity incentive plans also represent the practice of equity incentives in China.The problems exposed during the implementation of the plan are also common problems for most companies that initially explore equity incentive plans.With policy changes,market volatility and adjustment of corporate strategy,Yonyou Network continues to improve its equity incentive plans.In this context,how to design and implement the company's equity incentive plan,what are the advantages and disadvantages of the plan,how to improve the incentive plan,and how to enlighten other companies to implement the equity incentive plan are worthy of careful consideration.This paper analyzes the Yonyou Network's equity incentive plan combined with the background and the company's development strategy,and also analyzes its incentive effect.On the other hand,the advantages and disadvantages of the plan are proposed.For Yonyou Network,it can improve its plan in the future,and for the other companies,it can provide reference to implement their own equity incentive plans.At last,hope this paper can contribute to the further improvement of the equity incentive related system.