Research On The Influence Of Equity Incentives On Market Value Management

Equity incentive is a common incentive method for managers to connect their own interests with the development of the company to coordinate their interest relationship and realize synchronous growth of each other.It grants equity to employees who meet certain conditions,so as to enhance their subjective initiative,positive creativity,and allow them to participate in corporate governance and other activities."New country nine" put forward new requirements for market value management.In the face of this situation,listed companies began to pay attention to market value management and actively take relevant measures,and then it has become a hot topic in the practical and theoretical circles.As a way of value management,equity incentive itself has the functional attribute of effectively stimulating the vitality of the company’s market value management,and has been widely used as a powerful measure of market value management by listed companies.And whether equity incentive can really have a positive impact on the market value management of listed companies,its operating principle and influence mechanism.In view of this,the main research work of this paper is as follows: select Sunshine Power,a listed company that has implemented four equity incentives from2013 to 2022 and has a wide time span,as the research object,and conduct an in-depth analysis of the case.The implementation steps include: First of all,I carefully studied the theories,materials and knowledge related to market value management and equity incentive,and formed the research idea that "the influence of equity incentive on market value management of listed companies is generated by influencing the enterprise’s value creation and value realization ability".Secondly,taking Sunpower Company as the research object,the paper analyzes the demand of Sunpower company in market value management and the implementation of four equity incentive schemes.Thirdly,it explores how the equity incentive scheme of Sunshine Power company influences market value management,and analyzes the resulting effect.Finally,some relevant research conclusions and enlightenments are drawn.This paper believes that after the implementation of equity incentive,Sunshine Power company can positively influence the management of the company’s market value.For example,if the scientific equity incentive plan is made public,it can send a positive signal to investors and get their support when the company’s market value is less than its intrinsic value,which is conducive to the improvement of its market value,although the improvement is short-term.But it can make the matching degree of internal market value and intrinsic value more fit.At the same time,the equity incentive program also gives full play to its driving force,encouraging managers to establish a stable core team of employees,and create value in key value creation activities such as R&D activities and sales activities,so as to improve the intrinsic value and the company’s operating performance.In addition,the company’s mid-and long-term value realization activities(such as investor relationship management)have also been improved,which can mobilize managers’ initiative to objectively and completely disclose information and accurately convey intrinsic value to the capital market.Based on the above research,it can be concluded that the influence mechanism of equity incentive on market value management is as follows: the key value creation activities of the company are deeply affected by the equity incentive program,which further promotes the intrinsic value of the company and realizes "value creation";Meanwhile,the equity incentive plan can also promote the stock price.When the market value does not match the intrinsic value,timely announcement can deliver good news in the short term,so as to increase the market value and accurately reflect the intrinsic value of the company.In the subsequent development period,for the external market,the company will attach importance to investor relationship management activities and disclose relevant information objectively and completely to ensure that its intrinsic value can be fully reflected in the capital market,namely "value realization".This paper analyzes a single case of Sunshine Power Company to further understand and grasp the ways that equity incentives affect market value management,and then draw a reliable conclusion,which reflects the research value of this paper.At the same time,this paper focuses on the Sunshine Power Company,a new energy equipment enterprise that has implemented many equity incentive schemes and achieved fruitful results in market value management in recent years,studies its equity incentive schemes and explains how equity incentives affect market value management.In order to provide some useful ideas for this industry and other listed companies to correctly use equity incentive means to enhance the management level of market value.