Research On Motivation And Effect Of Equity Incentive And De-Familization

Over the past 40 years of reform and opening up,family enterprises in China have been making outstanding contributions to the fields of increasing wealth,expanding employment and stimulating economic growth.They are the backbone of China's rapid economic development.With the constant change of the external economic environment,the disadvantages of the management of traditional family enterprises in China are gradually exposed.Many family enterprises have to face the transformation,and the management of enterprises is constantly improving in the direction of institutionalization and specialization.The inheritance of family business is no longer necessarily the inheritance of the father's business.Transforming by introducing professional managers or gradually transferring corporate ownership has become the choice of many family businesses..With the weakening of the degree of familiarization,the change of controlling shareholders and the change of the nature of enterprises,the principal-agent relationship,the management concept and the development orientation of the company will also change,which will inevitably be reflected in the design of equity incentive plan.Establishing equity incentive schemes to alleviate the problem of principal-agent in enterprises is a way and method chosen by many traditional family enterprises,and family enterprises have their particularities in two types of principal-agent problems.Therefore,this paper takes SUPOR as an example to study the design of equity incentive scheme in the process of family business de-familiarization,in order to encourage management to create wealth for all shareholders,or to seek private interests for large shareholders and executives,and to become a tool for profit transmission? Can we effectively alleviate the principal-agent problem peculiar to family business? Through sorting out the research results of previous scholars,combining with case analysis,the design motivation of equity incentive is divided into welfare motivation and incentive motivation.As a representative case,from 2006 to 2017,SUPOR gradually de-familiarized from a completely family-owned enterprise.In this process,three equity incentive schemes have been implemented before and after.Next,starting with the design motivation of the implementation of equity incentive,this paper analyses the changes of financial performance,non-financial performance and market reaction before and after the implementation of different schemes.Through comparative analysis of the design elements of various schemes,it is found that the design of equity incentive schemes in the stage of complete familiarization has the motive of seeking welfare for family members,i.e.welfare-oriented motive;The design of two equity incentive plans in the process of gradually changing the level of familiarization shows the intention of encouraging executives and employees to manage enterprises according to the principle of maximizing shareholder value,that is,incentive-oriented motive.The implementation effect of equity incentive in these three stages is reflected.Finally,according to the case analysis results,this paper summarizes the success and drawbacks of the equity incentive scheme of the case enterprises,and puts forward corresponding suggestions for improvement,with a view to providing relevant practical experience for the future transformation of traditional family business companies and the design of equity incentive in the transformation.