The Impact of Employee Stock Bonus on Taiwan Stock Market -The Case of IC Industry

• Main Authors: Szu-i Chen, 陳思伊
• Other Authors: Huang Jen-Jsung
• Format: Others
• Language: zh-TW
• Published: 2008
• Online Access: http://ndltd.ncl.edu.tw/handle/m3penn

碩士 === 國立中山大學 === 國際經營管理碩士班 === 96 === From 2008, employee stock bonus must debt expense according to national law and policy. How to get balance between employees and shareholders without eroding benefits becomes the most difficult challenge to many enterprises. The employee stock bonus has been implemented in Taiwan for a long time. This system does play a significant role in high-tech industry and make a great contribution to Taiwan’s economics. However, since a series of business scandals starting with Enron case in 2001, this unique system has been broadly discussed and caused serious debates. One of the most controversial arguments claims that employee stock bonus will weaken the stock price and hurt equity. The study is based on pooled time-series data during 1998-2007 from the IC industry corporations trading on the Taiwan Stock Exchange Corporation and Over-The-Counter market. The purpose is to examine the impact of employee stock bonus on Taiwan stock market by analyzing the variation in Cumulative Average Abnormal Revenue (CAR). The empirical results are summarized as follows: 1.With the factor of employee stock bonus, the ex-dividend effects still existed in IC industry of Taiwan stock market. The negative CAR was particular in evidence on the three days prior to the ex-date. There were no obvious trends of ex-dividend effects during this decade. Both employee stock bonus and dividends were declined year by year which represented that corporation had adjusted their policy with a downward tendency. 2.Before the ex-date, the group of moderate employee stock bonus was beneficial to the CAR and created better performance of stock price with the least dilution effect. On the contrary, the group of low employee stock bonus came out the worst performance. After the ex-date, the group of high employee stock bonus exhibited the best ex-dividend effects and sustained the performance longer. But the group of low employee stock bonus still performed poorly with the most negative CAR. Base on above findings, employee stock bonus not really hurt the stock price but benefit equity if corporations use this system adequately. High employee stock bonuses maybe deliver a positive signal which implicates a bright future.