share schemes nora ward and niamh coyne employment, pensions and benefits group m-7618560...
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Share Schemes
Nora Ward and Niamh CoyneEmployment, Pensions and Benefits Group
M-7618560
Opportunities In a recession
Geo Breakfast Seminar 23 September 2009
2
Outline of Discussion
• Share Schemes – Recent trends in Irish Market
• Share Schemes Menu
• Market case-studies
• Conclusion
3
Share Schemes – Recent Trends in Irish Market
• Corporate Governance
• Shares v Cash
• Options v LTIPs
• Performance indicators TSR v EPS
• Underwater options/share awards
• Financial institutions and impact of State Guarantee on equity incentives (CIROC)
4
Share Schemes – Recent Trends in Irish Market
• Disclosure of directors remuneration
• Commission on Taxation Report
5
Share Schemes – Opportunities in a recession
• Employer benefits of Share Schemes
• Employee benefits of Share Schemes
6
Employer benefits of Share Schemes
• Minimal cash cost to employer
• Costs tax deductible
• Currently no employer’s PRSI
• Increase productivity with performance targets
• Incentivise staff
• Align employee and owner’s interests
7
Employer benefits of Share Schemes
• Potentially valuable awards
• Awards at bottom of market maximise gain
• Tax efficient schemes reduce tax payments
• Low risk for employee
8
Share Schemes – Menu
• Options
– unapproved option scheme
– Revenue approved option scheme
– Revenue approved SAYE scheme
• Share awards
– Revenue Approved Profit Sharing Scheme
– clogged shares
– forfeitable shares
– restricted stock units (RSU’s)
9
Recent Market Case-studies
• Pay cuts and awards
• New schemes/grants
• SAYE schemes
• Underwater options
10
Conclusion
• Recession problems
• Share scheme solutions
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