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Rajah Lehal

ESOP's Become Increasingly Popular in the Financial Sector

October 28, 2015

Links from this article: Read the article here.

With the market recovering and stabilizing in 2014, ESOPs became very popular in the financial sector. ESOPs are a tool for the retention and motivation of employees, and the return to strong markets encouraged firms in the financial services to issue ESOPs to retain their top talent. The ESOP retention tactic was not just popular with private banks, but are also became more popular with state-owned banks. This is evidenced in the example of the Bank of India who considered issuing ESOPs to their employees. Public banks have difficulty retaining talent, compared to private financial institutions, and are hoping their ESOP’s will have a positive effect on the retention of their talent pool.

Read the article here.Take away:

  • Post 2008, talent is less likely to be incentivized by loyalty. ESOP’s are a more attractive mechanism to retain talent.
ESOP
Purpose of Option Plan
Human Resources

Written by Rajah. Rajah Lehal is Founder and CEO of Clausehound.com. Rajah is a legal technologist and technology lawyer who is, together with the Clausehound team, capturing and sharing lawyer expertise, building deal negotiation libraries, teaching negotiation in classrooms, and automating negotiation with software.