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Share ownership on the rise in Ireland, but barriers remain

19 September, 2022

Share ownership is on the rise, but employers and employees are often still slow to embrace the general concept of employee share ownership. More support is needed for SMEs and large companies to encourage share ownership. Share ownership can improve productivity and, to alleviate current talent challenges, it is also an important tool for recruiting and retaining key staff. These are the views of the Irish ProShare Association (IPSA) who will hold their annual conference on 21 September at PwC’s Dublin offices.

Speaker and audience at conference

Speaking in advance of the conference, Marie Flynn, PwC Tax Director and Chairperson of IPSA, said: “Ireland is lagging behind rival countries in share scheme offerings. All sizes of companies are being negatively impacted risking the loss of key talent. Being competitive is vital in this volatile and changing economy we find ourselves in and share equity is an important part of any compensation package to be able to maintain a competitive edge.”

“Barriers in Ireland to share ownership include a lack of suitable schemes available, the cost and administration of plan implementation, scepticism towards the benefits of employee share ownership, lack of employee finances and lack of institutional support and leadership from Government.”

Key changes

A few small key changes to existing measures would make a significant difference to Ireland’s ability to compete internationally in its share scheme offerings.  

For SMEs: Extension and reform of KEEP

There are fundamental flaws in the Key Employee Engagement Program (KEEP), which has a very low take-up. For example, it is not generally available to groups of companies (i.e. companies with subsidiaries etc) and, with the amount of conditions that need to be met, it is complex and expensive to implement. In addition, further enhancements are needed to ensure that capital gains tax treatment on a sale can be applied in a wider range of situations to increase the availability of the scheme to, for example, family companies.

Save-As-You-Earn

For larger organisations the Save-As-You-Earn (SAYE) scheme is no longer viable for new schemes as there is no financial institution in the Irish market willing to hold such employee savings. Government needs to step in and designate or facilitate a bank or other savings carrier to operate the SAYE scheme. 

Other items requiring small legislative changes to benefit small and large companies to bring Ireland into line with most other countries include removing the seven year time limit for exercising unapproved share options. This would facilitate companies being able to grant long term incentive options to employees at any price. Reducing the Benefit-in-Kind on employer loans to buy shares from the 13.5% rate to a market rate would also be welcome and would also bring Ireland into line with international competitors.

Marie Flynn concluded: “The changes required to make these improvements are small and broadly cost neutral for the Government but would be very welcome to encourage more companies to offer shares to their employees and employees to invest in the businesses in which they work. It is a “win win” for Irish businesses as share ownership would not only increase performance and productivity but is also a great way to attract and retain key talent.”

Note to editors

About IPSA

The Irish ProShare Association (IPSA) is a member-led, non-profit organisation which represents companies which are engaged in some form of employee share ownership, and advocates for increased employee ownership in Irish business as a sustainable business model for the future.


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Johanna Dehaene

Corporate Communications, PwC Ireland (Republic of)

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