Small and Medium Company ESOP Solutions
Our full turnkey employee ownership solution includes:
Scheme design and planning
Ownership Solutions provides a full turn-key service in the implementation of ESOP’s and broad-based community trusts.
Our corporate finance and legal team believe that, in their experience, it is only through modelling the scheme to termination, that the human resource impact on the company and individual participants can be properly understood.
We also specialise in distressed plan rehabilitation and restructuring.
After investing time with management, and taking into account the economic reality of the business or project, we will prepare an interactive financial model that will show management the impact on both an individual employee and the scheme of:
- Allocation Rules
- Impact of good and bad leavers
- Growth in asset size
- New entrants
- Potential liabilities to good leavers
- Actual payout of vesting
- Administration and communication impact
- IFRS 2 Costing
The impact of the key variables on a scheme can be substantial. The incorrect initial allocation and rules may result in an exodus of employees, or a significant mismatch in expectations amongst the employees. The results of this modelling will also be used as the basis for the communication of benefits to the employees. This model will place the implementation team in a position to decide on the best scheme type based on the specific needs and circumstances of the business.
The legal process
Our in-house legal team will prepare a comprehensive set of legal documents in partnership with Bowman Gilfillan, or a law firm of your choice.
Our experience and understanding that comes from specializing in ESOP implementation allows us to deliver a cost effective legal solution with the peace of mind that comes from the backing of a major law firm.
When required, we are able to mobilise resources to deliver a completed scheme to match your urgent needs.
Employee communication and training
A successful scheme requires employee buy-in, and this can only be achieved following successful communication of the nature and structure of the scheme to employee participants.
Ownership Solutions has material available in several official languages which explains the economic benefits, the proper voting procedures, the effect of changes in profitability on value to employees, and the implications of leaving the business.
In addition training is provided to enable relevant employees to fulfil their new responsibilities within the scheme.
Administration
This can often become an onerous task for the business. Ownership Solutions is well equipped to provide a fully outsourced administrative function. As well as management of scheme participants, we provide full annual reporting encompassing financial statements and empowerment credentials. A register of participants is maintained, and unit or share certificates are provided to the participants along with statements.
Benefits of ESOP's to the employer
- Aligned shareholder, management and employee interests
- Employee morale and motivation levels are boosted
- Enhanced employee commitment
- Reduced employee turnover
- Improved employee performance and productivity levels
- Improved customer/client services
- Improved quality: reduce scrap rates, product returns, write-offs
- Improved operating efficiency, through put and labour utilisation
- Increased project, business unit, and company profitability
Benefits of ESOP's to the employee
- Financial gain in addition to normal salary and retirement savings
- Employees share in the company's capital growth
- Unity and team spirit with common objectives of improving company's value
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