Relationship between restricted stock plan management and loyalty management from the perspective of corporate governance

Abstract

The current economic situation in China is becoming increasingly severe, and many Chinese companies have a strong tendency for their management to leave it, intending to find a more stable development platform at a time of declining corporate efficiency. Those companies’ stable employment relationships are under serious threat. How to enhance management loyalty through restricted stock plans is of practical, theoretical value for companies at this time. This paper aimed to investigate the effectiveness of the management of restricted stock plans in enhancing loyalty management from the perspective of corporate governance and explore effective ways to improve corporate competitiveness and restricted stock plan management. The research focused on Company A, a Chinese company, as an example. Data were analyzed based on a theoretical framework. The results revealed that restricted stock plans played a mediating role in enhancing loyalty management in the corporate governance process. The research found three main factors that influenced loyalty management in the implementation of Company A’s restricted stock plans, namely: the grant amount factor, the restriction period factor, and the corporate institutional mechanism. Finally, the implementation of restricted stock plans was appropriate, helping the company to deal with the dual pressure of economic downturn and high management turnover situation effectively.