In recent times, we’ve been involved in dozens of conversations on the different opportunities for equity holders. The once distinct line that a business had “Partners” and that was the requirement to be an equity owner is no longer the case.
In the last twelve months, we’ve seen a number of small equity holdings (from 1 – 2.5%) to key employees who remain in their current positions, while being rewarded through profits. What may not seem like much when looking at the percentage, can be considerable in a large business.
What it shows though, is that you don’t have to be a “Partner” to have equity. You can be Head of People and Culture, a Lead Adviser, or Senior Manager and maintain your day-to-day role. In one of these scenarios, shareholders are provided with quarterly financial reports and participate in high level business planning, but otherwise perform their traditional roles. “Partners Meetings” are held with major shareholders who make day to day management decisions. These key people are now rewarded by capital growth in the business, and real profit sharing via dividends.
Yes, this could all be done via an employee share scheme, but being a part owner of the business directly? It certainly seems like a winning proposition for these businesses.
If you’d like to talk about how we can help you reward and encourage your staff, contact our office today.
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