Jinxiong Yu

Beijing Foreign Studies University

Abstract：

This paper investigates the application and impact of Valuation Adjustment Mechanisms (VAMs) on corporate performance in the film industry, using the case of China's Huayi Brothers and director Feng Xiaogang. Following an overview of VAM fundamentals and industry context, the study analyzes their contractual terms, execution, and outcomes. The research indicates that VAMs, through performance targets and compensation, can motivate management to enhance corporate performance. However, market uncertainties and management risks may lead to adverse financial and stock price impacts. This study provides theoretical insights and practical guidance for optimizing VAM design, offering valuable references for corporate management and risk control in the film industry.

Key Words：

valuation adjustment mechanism; celebrity partnership; film industry; corporate performance; risk management