As a significant incentive mechanism, equity incentives align employee interests with the long-term development goals of the enterprise, thereby stimulating employees' innovation enthusiasm and sense of responsibility, and subsequently enhancing the company's innovation capability and performance. This paper takes Joyoung Co., Ltd. as a case study and examines how equity incentives influence the company's innovation performance and implementation outcomes through three pathways: innovation input, innovation output, and innovation transformation. The study finds that equity incentives effectively increased Joyoung's innovation input, particularly in terms of R&D expenses and R&D intensity. Furthermore, equity incentives also drove technological innovation and the commercialization of results, with a notable increase in the company's R&D investment and technological achievements especially after the equity incentive plans implemented post-2017. However, amid changes in the external market environment, the effectiveness of equity incentives in enhancing corporate profitability and innovation transformation has diminished. In terms of corporate performance, equity incentives positively contributed to short-term performance, but their long-term effects were relatively limited. Particularly under external shocks such as the pandemic, sustained growth as initially anticipated was not achieved. Based on an analysis of the "M-S-M" transmission mechanism, this paper offers relevant recommendations, providing a reference for other enterprises in designing and optimizing their equity incentive mechanisms.

Zhang Yuan. Equity Incentives and Corporate Innovation: A Case Study of Joyoung Co., Ltd. Academic Journal of Business & Management (2026), Vol. 8, Issue 1: 1-8. https://doi.org/10.25236/AJBM.2026.080101.

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