Equity Incentive Design Project for a Pre-Listed FMCG Enterprise

A rapidly expanding Retail Brand in China - Equity Incentive Design Project

Project Background

With rapid business expansion following its Pre-IPO, the company’s existing incentive framework no longer fully reflected the long-term contributions of its key employees. The objective was to design a structured, measurable equity incentive plan to strengthen employee retention and performance alignment, achieving a win-win outcome between corporate and individual growth.

Project Scope & Objectives

Developed a value-driven equity incentive framework balancing corporate governance and market competitiveness. Structured around three key pillars — quantitative allocation, participant selection, and time-based vesting — ensuring fairness, feasibility, and strategic alignment.

Core Design Dimensions

1.  Equity Pool & Allocation

     • Defined the overall equity pool and grant ceiling based on financial projections and market capitalization growth targets

     • Applied scenario-based modeling including performance achievement rates, dilution impact, and ROI analysis to design allocation logic

     • Linked incentive value directly with business performance to ensure pay-for-performance alignment

2. Participant Identification

    • Targeted core management, critical functions, and high-potential talents

    • Identified participants using job value assessment and performance contribution models

    • Created a tiered structure balancing incentives across leadership, critical roles, and succession pipeline

3. Vesting & Performance Cycle

    • Established a 3–5 year vesting schedule tied to annual performance reviews and corporate KPIs

    • Implemented performance gates to align vesting with sustainable business performance

    • Ensured compliance with listing regulations and disclosure standards for transparent implementation.

Key Challenges

   • Balancing financial affordability with competitive incentive value

   • Managing varied incentive expectations across different levels while maintaining equity and motivation

   • Coordinating communication across internal stakeholders and ensuring transparent disclosure as a listed entity.

Project Execution

   • Analyzed corporate strategy, financial capacity, and workforce structure to define incentive principles and boundaries

   • Developed multiple incentive models (e.g., RSUs, stock options, phantom shares) with quantitative scenario testing

   • Provided financial modeling, tax impact assessments, and feasibility analyses for each plan

   • Supported executive communication, board presentation, and implementation roll-out

Project Outcomes & Value

   • Established a long-term equity incentive system aligned with corporate strategy, enhancing retention and loyalty

   • Strengthened employer brand and market competitiveness within the retail and FMCG industry

   • Fostered a performance-driven, value-sharing culture that supports sustainable business growth

   • Provided a scalable incentive framework applicable to future regional and global business expansion