For listed companies, the common incentive method is to grant stocks, and the value of stocks is the value obtained by employees. For example, Tencent's annual incentive method only attaches certain conditions to most stocks, so it is also called restricted stocks, that is, employees can unlock and obtain stocks after completing certain conditions.

From the company's point of view, restricted stocks can improve the effectiveness of incentives, and the motivated employees must meet the conditions proposed by the company, which are often linked to performance and strategic goals. If employees can really get stock incentives, the company will also enhance its value because of the completion of the conditions.

And because of the development of the company after listing, it will not grow explosively like before listing. If you give options, the value-added part is not so obvious. Because restricted stock is the value of stock, in contrast, employees can have a more direct perception of incentives.

We know that no matter how to calculate the rights and interests of enterprises, the total amount is 100%. If the proportion of equity used to motivate employees is as high as 50%, it will greatly affect the control rights of founders and shareholders, thus affecting the daily decision-making and strategic positioning development of enterprises. If the proportion of equity incentive is large, virtual equity incentive can be chosen as an incentive tool to stabilize control rights.

Virtual stock incentive does not directly give employees options or shares, but allows employees to enjoy the economic benefits of shares, including profit sharing and share appreciation, but employees do not enjoy the voting rights and ownership related to shares. This kind of operation, like Huawei, not only allows employees to fully enjoy the economic benefits brought by the value-added development of enterprises, but also firmly holds the control right in the hands of decision makers.