Year: 2025
Type: article
Abstract: Investment plays an important role in the growth of modern enterprises. It is not only the cornerstone of sustainable development, but also the investment efficiency. Now China is in an important period of high-quality economic development and optimization of resource allocation, using equity incentive as a long-term incentive tool to improve corporate investment behavior and improve investment efficiency, is critical to the company’s sustainability. In the context of China’s long-term shift from an investment-driven economy to one that is “innovation-driven, service-oriented and consumption-driven”, traditional enterprises are actively transforming to emphasize innovation investment, the rapid development of new enterprises emphasizes efficiency investment, which becomes the focus of “efficiency dispute” and “innovation dispute” among enterprises. The 14th five-year plan proposes to achieve high-quality development and give full play to the advantages of innovation-driven development. In this case, the equity incentive is a kind of long-term incentive mechanism which is helpful for the development of the enterprise, thus reduces the manager’s short-sighted behavior, lets it be able to carry on the daily management activity from the company long-term development angle one kind of effective means and the mechanism. In this study, M listed company in the home appliance industry are selected as research cases. Through the analysis of the impact of equity incentives on the investment behavior of M listed company five times, although it did not make the amount of investment significantly increased, but every time to complete the plan of the exercise of the conditions, long-term exercise of the right to make the late return to a stable development. Under the incentive mechanism of stock right incentive, the interests of shareholders, managers and core employees of M listed company are tied up well, which makes all departments, whether shareholders or employees, make decisions, always for the future development and long-term interests of the enterprise, so through the way of equity incentives to improve their loyalty to the enterprise, enthusiasm and sense of responsibility. The conclusions can provide theoretical support and empirical evidence for enterprises to improve their investment behavior by using equity incentive, and provide reference for enterprises in the industry to design and implement equity incentive mechanism.
Authors: Xiujuan Zhang, Thillai Raja, Yixiao Xu, Dan Chen
Institutions: Yunnan Technology and Business University, SEGi University
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W4408634446