Empower your business by empowering your employees
Employee Share Ownership Plan (ESOP)
Employee Share Ownership Plans (ESOPs) can address BEE Ownership, while aligning employees with the business owner’s interests. A well structured and executed ESOP can improve business performance by correctly incentivising staff and can also strengthen labour relations.
Broadening empowerment
ESOPs empower the people in your business
Use BEE Ownership to attract, retain and reward employees as partners in your business
Our experience helps you succeed
- We have extensive experience in structuring and implementing ESOP transactions for multinational companies and SA corporates. We have advised on more than 150 transactions since 2005
- An in-depth understanding of the BEE environment, knowledge of BEE structures and their complexities, and our proven corporate finance expertise allows us to combine best practice with innovative thinking
Feasibility of an ESOP
We help you understand if an ESOP will work for your company by evaluating:
- Your employee demographics - for BEE points.
- Your employee numbers - to ensure value flows to employees.
- Your financial projections - to ensure sustainability.
- Your culture - to establish if an ESOP is right for you.
Managing Employee Share Ownership risks
ESOPs can be daunting and can pose risks to companies. We help you understand the risks and set out risk mitigation strategies through:
- Modelling of various financial scenarios and providing solutions.
- Solid alignment and setting expectations upfront.
- Robust legal documentation.
- Employee engagement.
Turnkey implementation
- We design the scheme.
- We structure the scheme.
- We present the scheme to your employees and assist with union negotiations.
- We draft robust legal documents that protect your rights.
- We help roll out and communicate the scheme in the relevant official languages.
- We assist with dealing with your BEE verification agency.
- We assist with liaising with the BEE Commission.
Understanding how value is created for employees
In designing a successful ESOP, there should be transparency as to how employees participate in the economic benefits based on the performance of the company. This requires:
- Understanding the liquidity mechanisms.
- Having clear good and bad leaver provisions.
- Apportioning dividends and capital gains systematically.
- Bench-marking against other schemes across relevant industries.
Ensuring you maximise your BEE Ownership
- We structure the transaction to maximise the current and long-term BEE ownership credit.
- We work with your BEE verification agency to ensure you get the BEE points you expect.
- We assist you with the BEE Commission registration process.
- We partner with you each year thereafter to ensure the points endure.
Help communicate your ESOP
We help with:
- Programme conceptualisation and theming.
- Agreement of key messaging and alignment with company values.
- Design and development of communication material for fiduciaries and participants.
- Facilitation of ESOP fiduciary training sessions.
- Facilitation of participant training sessions.
- Reporting on training sessions.
Get in touch
ESOP Consultation
Please contact us to set up a call to discuss how we can help you think through implementing an ESOP
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We are dedicated to deliver transformation training, advisory and relevant content during the South African COVID-19 lockdown period.