Stock Option Incentive Plan and Employee Engagement: Evidence from China

Abstract

This study examined the influence mechanism of the Stock Option Incentive Plan on employee engagement among 435 employees in the state-owned enterprises of China. Through interviews and questionnaires, this study found there was a significant negative correlation between the Stock Option Incentive Plan gap and the level of employee engagement. This study also found employee psychological safety, psychological significance, and psychological availability played an intermediary role in the relationship between Stock Option Incentive Plan gap and employee engagement. Meanwhile, balanced reciprocity positively regulated the relationship between employee psychological safety, psychological significance, and employee engagement. Under the specific cultural background of China, a number of interesting insights were discovered, which were of great theoretical and practical significance. Firstly, this paper enriches the antecedent variables of employee engagement. This article explores the mechanism of the Stock Option Incentive Plan gap on employee engagement under the specific Chinese cultural background, which makes ups the vacancy in the existing literature, and provides a clearer theoretical basis for how companies can effectively motivate employees. Secondly, this paper deepens the impact mechanism of the Stock Option Incentive Plan gap. The empirical results of this paper show that the Stock Option Incentive Plan gap will affect the psychological conditions of employees and further employee engagement. That is to say, if an enterprise intends to effectively improve employee engagement, it must actively pay attention to the individual psychological factors of the employee. The psychological stability of employees is conducive to forming a harmonious atmosphere within the organization and the construction of the collective team.