An effective reward plan is essential for the growth of any business and the provision of appropriate incentives can increase the success and profitability of all companies by attracting and retaining key talent.
For an individual the inclusion of an equity based arrangement in their pay package has the potential to become a significant and often valuable element of compensation. Accommodating such an arrangement without diluting the owners’ equity or disrupting the business can be achieved with careful planning.
For the company, as managers are recognised and rewarded as shareholders in the business, the reward can be directly related to the performance or the value of the business by encouraging them to contribute to growth and profitability. In addition, share incentives are one of the few non-cash benefits which are not liable to employer’s PRSI.