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What does the equity incentive system mean?

Equity incentive system is a long-term incentive mechanism implemented by enterprises to motivate, retain and attract core talents. The enterprise conditionally grants the incentive object some or all of the shareholders’ rights and interests , so that it can form a community of interests with the enterprise, so as to realize the long-term development goal of the enterprise.

The scope of the implementation of the equity incentive system includes enterprise executives, middle-level management personnel and key employees of the enterprise. The implementation of the equity incentive system is oriented towards the future while taking into account the past. On the one hand, it is necessary to motivate the veterans in the entrepreneurial period of the enterprise, and on the other hand, it is also necessary to give sufficient incentives to the rising stars of the company.

The forms of the equity incentive system include: futures shares, options, dry shares , real shares, etc. According to the characteristics of the industry in which the enterprise is located, the specific conditions of the enterprise and the specific conditions of employees and shareholders , you can choose the form that suits your company. . The form of the incentive system can be various, and it is constantly updated with the different development stages of the enterprise.