A Case Study On Equity Incentive Plan Of C&S Paper Co Ltd

Equity incentive is a long-term incentive mechanism implemented by enterprises in order to motivate and retain core talents.It is also widely used in China's listed companies.However,due to the short development time of China's equity incentives,the implementation of equity incentives has not achieved the expected results.Therefore,the research on equity incentives in China can not only enrich the theoretical basis of equity incentives,but also provide practical guidance for companies to better carry out equity incentive,which is of theoretical and practical significance.This paper selects C&S Paper,the leading enterprise in China's tissue industry,as a case to study.The entire process of its equity incentive plan was analyzed based on theory and practice,including the driving factors before implementation,the design arrangement during implementation,and the performance after implementation,which are specifically reflected in the analysis of incentive drivers,rationality analysis of incentive elements,and incentive effects analysis,and summarizes the experience on the basis of case analysis,in order to provide reference for other enterprises to better implement equity incentive.This paper first reviews the relevant theories,and then combs the two equity incentive schemes of C&S Paper.Based on this,it explores the motivations of implementing equity incentive from both internal and external perspectives.The analysis results show that it intense the company's need to improve performance,improve management,sales and R & D capabilities and retain manager and attract core talents are the main motivations for C&S Paper to implement the first equity incentive plan,while the continuation of the previous equity incentive plan is the main reason for the second equity incentive plan.In terms of the rationality of incentive factors,this paper analyzes the relevant information and finds that C&S Paper Co Ltd chose appropriate incentive methods,incentive objects and grant price of equity incentive,and designed reasonable conditions for unlocking.But its equity incentive plan also has the problem that the performance evaluation index is not comprehensive enough.In terms of implementation effect,this paper analyzes the performance of equity incentives from three dimensions: market performance,financial performance,and non-financial performance.The results show that the market response of this equity incentive plan in 2015 is more positive,and it does play a role in attracting the core talents and stabilizing the management team,thereby improving the management ability,R&D ability and sales ability of enterprises,which ultimately improved corporate financial performance.The inspiration of this case is as follows: enterprises should select appropriate incentive methods and incentive objects in combination with their own strategic planning and development stage,and determine reasonable granting price and unlocking conditions.At the same time,they should also build a comprehensive performance evaluation system,and continue to introduce new ideas to make equity incentive become a normal incentive mechanism of the company.