Research On Equity Incentive Schemes For Real Estate Listed Companies From The Perspective Of Enterprise Life Cycle

With the development of China’s modern market economy and the improvement of laws and company systems,more and more listed companies are using equity incentives in their business management activities.Equity incentives can make a long-term and stable incentive environment,improving employees’ work autonomy and enthusiasm.In addition,equity incentives can also reduce the agency costs of a company,improve the employee compensation mechanism,effectively attract and retain talents,and reflect the fairness of company management.However,we can see its effectiveness is not very ideal from the current situation of using the equity incentive system in listed companies in China.Many companies have short-sighted behavior and a "one size fits all" approach in the implementation process of equity incentives,which leads to unclear incentive effects and weak incentive,and does not truly bring long-term and sustainable economic value to the company.However,enterprises exhibit significant differences in their different life cycle stages.In previous literature research,scholars often only generalize the design of equity incentive plans and do not fully consider the impact of the company’s life cycle stage when analyzing equity incentives.It is worth studying how to choose and design equity incentive plans that match the characteristics of the company’s lifecycle stage,so as to maximize the effectiveness of incentives.This article selects Centralcon Holdings,a real estate enterprise,as a sample,as it was one of the first real estate development enterprises established after the establishment of the Shenzhen Special Economic Zone in the early stages of China’s reform and opening up.It has gone through the entire process of China’s real estate industry from scratch,from state-owned enterprise monopoly to the rise of private enterprises,and has become a highly competitive industry,with a certain degree of creativity and representativeness,Use case analysis method to study the three draft equity incentive plans announced by Centralcon Holdings before and after the announcement.Secondly,from the perspective of life cycle theory,this article provides a detailed division of the life cycle of Centralcon Holdings through the cash flow method and univariate analysis method.Ultimately,it is divided into the start-up period of the company before 2008,the growth period from 2009 to2017,and the maturity period of the company after 2018.Then compare the content of its three equity incentive plans,including incentive methods,incentive targets and grant quantities,exercise prices,performance evaluation conditions,etc.,and analyze their various characteristics and differences in depth,as well as the reasons behind them.Finally,a comparative analysis will be conducted on the economic consequences of each equity incentive implementation,including market response,company financial performance,and corporate governance.The characteristics and existing problems of Centralcon Holdings’ equity incentive plan in various life cycles of the enterprise will be summarized,and reference suggestions will be proposed.Finally,summarize the shortcomings of this study.After analysis,this article believes that:(1)there are differences in the motivation of equity incentive plans for enterprises at different stages of their life cycles.In this case,there are significant differences in the equity incentive plans designed by enterprises during their start-up,growth,and maturity stages,resulting in differences in the motivation of equity incentive plans for enterprises within their different life cycles;(2)The effectiveness of implementing equity incentives varies at different stages of a company’s lifecycle.In this case,the effect of equity incentive implemented by the company during its growth period is better than that implemented in its maturity stage.