Study On KEDA's Equity Incentive Plan And Its Implementation Effect

With our country economy entering the New Normal,Listed companies face great operating pressure.It is more important to use investment and research and development to pursue transformation,and inspire the staff's enthusiasm and creativity in order to improve the enterprise vitality.Equity incentive,as a kind of incentive mechanism that can reconcile shareholders and incentive objects'interests,has the function of reducing agency cost,improving staffs enthusiasm,attracting and retaining talents,promoting investment and research and development,and etc.More and more companies implement equity incentive as a way to enhance competitiveness and promote long-term development.But many companies' equity incentive plans are not reasonable and implementation effect is not well.So it is necessary to do research about equity incentive plan formulation and implementation to provide guidance for enterprise practice.This paper firstly combs the research situation about equity incentive,and introduces theoretical basis.Then taking KEDA Corporation as a case,this paper studies the two equity incentive implementation during its transition period,introduces the background and the motivation,and analyzes the plan elements combining with theory and corporate environment,evaluates the rationality,and evaluates the implementation effect,including realizing the goals and improving performance.Finally,this paper summarizes the experience of KEDA's equity incentive,and gets revelations about equity incentive plan formulation and implementation for listed companies.Though study,this paper finds that KEDA's two equity incentive plans are suitable for its motivation and environment,and have long-term,incentive and restrictive nature.Besides,it has good corporation governance and human resource system,so the effect is generally well.And other companies may take its experience as reference.