The Motivation And Implementation Effect Of Suning Tesco's Equity Incentive

Equity incentive is a kind of incentive method for the company‘s employees.In short,it is the company's realization of equity sharing for the core employees.The purpose is to maximize the enthusiasm of employees in the future development of the company,which is closely related to the future of the company.This can show that the stable and long-term development of the company cannot be separated from the efforts of employees themselves,which is reflected in various aspects such as income and bonus,that is,to accumulate wealth for themselves.In the last century,the implementation of equity incentive has become a method of tax avoidance,which led to the source of equity incentive of individual listed companies in the United States.In 2005,due to the practice of non tradable shares reform,China‘s capital market released a large number of non tradable shares,so in terms of system,it reduced a lot of obstacles and burdens.The fluctuation of stock price is more obvious especially in the global financial crisis in 2008.The stock price of capital market has suffered a heavy blow without exception,but it also brings the driving force for the company's equity incentive plan.The launch of the new plan requires companies from all countries to continuously test and seek for their own equity incentive plan.With the passage of time,it is not difficult to see that the advantages of equity incentive are far greater than the disadvantages,which leads to the effect called “incentive compatibility”.The link of this effect lies in the interests of the enterprise,and the owners and managers of the company have the same goal of maximizing the interests.The separation of the two rights is now the most widely used way of implementation of the company.The two rights are ownership and management rights,which also leads to the problem of principal-agent.How to solve these problems,equity incentive can be put into use,which can not only reduce the cost of principal-agent,but also reduce the moral risk of professional managers and the risk of reverse selection.Finally,it can enhance the competitiveness of the company in a period of time and play a good role in promoting the long-term development of the enterprise.Compared with the history of foreign equity incentive,China‘s implementation in this area seems to be much behind.Before 2005,China's capital market was lack of timeliness,the securities market was moving slowly,the establishment of equity incentive system was not perfect,and the governance of local companies could not keep up with the international pace.A large number of loopholes lead to the implementation of equity incentive has not enough effect.In the early stage ofpractice,the issue of amortization of option costs can not be implemented,so many companies suffer losses.Therefore,the advantages and disadvantages of equity incentive have not been grasped,and the positive significance of it remains questionable.The focus of this paper is to analyze the performance comparison and brain drain before and after the implementation of equity incentive plan by correctly analyzing their own business situation.Since the new century,more and more listed companies in China have invested in equity incentive plans.It is necessary to analyze and study relevant cases and understand relevant theories.Listed companies need more development experience to better implement equity incentive plans in line with their own development,and can also play an overall optimization trend for China's enterprise management model.Listed companies in China Have stronger competitiveness in global enterprises.