The Study Of Effects On Three Equity Incentive Schemes Of Media Group

The development of the market economy has led to the intensification of the contradiction between the management and the shareholders.The management pursues its own interests while the shareholders pay more attention to the development of the enterprise.The intensification of the contradiction results in the loss of core employees in the enterprise.In order to alleviate conflicts and improve team cohesion,Pfizer implemented the stock option plan in 1952,which was also the world's first equity incentive plan.Equity incentive gradually spread from the United States to the world.China introduced equity incentive in the 1990 s.However,due to different national conditions,the development of equity incentive has not reached the expected height in China.With the implementation of relevant plans,equity incentive began to develop rapidly in China.Studying the equity incentive,analyzing the design problem of the equity incentive scheme based on the specific case,analyzing and evaluating the effect of the incentive measures,which is helpful to provide reference information for the enterprises to implement the scheme in the future.The research idea of this paper is to raise the question: what is equity incentive? Why do companies choose equity incentives? How to determine the price and condition of equity incentive? Then,it analyzes the specific situation of implementing equity incentive measures in Media Group,and finally draws inspiration from experience,mainly using literature research method and case study method.Share-based incentive measure is a medium-and long-term incentive measure,which gives a certain amount of equity to the incentivized person with corresponding incentive conditions.Only when the incentive object meets the conditions,can the incentive be given.This paper analyzes the influence of equity incentive from two aspects: financial aspect and non-financial aspect.The theories used in this paper are principal-agent theory,incentive theory and human capital theory respectively.Media Group was founded in 1968,is the leading enterprise of domestic home appliance enterprises.Media Group implements equity incentive mainly from the following aspects: perfecting incentive mechanism and strengthening human resource security;Improve financial status and performance.Aiming at different objects,Media Group implemented three equity incentive plans.These three equity incentive plans have different emphasis on incentive objects and different conditions for exercising rights.Four periods of stock equity incentive plan were implemented from 2014 to 2017,and three periods of employee stock ownership plan and restricted stock incentive plan were implemented from 2015 to 2017.This article selects financial indicators and non-financial indicators for evaluation of the effect of the implementation,through a group of the main assets and liabilities,profits and earnings and cash flow related index was analyzed,the main financial indicators analysis based on the following four aspects: operation ability,profit ability,growth ability and debt paying ability.Non-financial indicators are sorted out through market reaction,personnel mobility and innovation degree of the company.After implementing the equity incentive plan for three times,Media Group has significantly improved its operating capacity,profitability,growth ability and debt paying ability,and is higher than the industry average level.The conclusion is that the implementation of equity incentive plan is conducive to improving corporate performance,and can play a positive role in promoting enterprise innovation,retaining employees and reducing personnel mobility.Finally,the author draws the basic conclusion and inspiration of the success of Media Group's equity incentive.Through the above introduction to Media Group's equity incentive and the specific analysis of the relevant effects,this paper draws the following conclusions.The success of Media Group's equity incentive is inseparable from the following four elements: 1.Media Group has a sound corporate governance mechanism.2.Organic use of equity incentive plans.3.Focus on medium-and long-term earnings growth.4.Scientific performance assessment index system.The equity incentive of Media Group also provides certain enlightenment for other enterprises.This paper believes that in order to make the equity incentive play a good effect,establish and improve the internal governance of the company,make a scientific equity incentive plan on the basis of their own development,and promote the combination of equity incentive plan and the long-term development of the enterprise.Finally,we need to improve the internal performance evaluation system,strengthen management management and prevention.