ESOPs have been known to be an effective tool for retaining talent. However, it is inevitable to have employees’ trust in the ESOP Plan for its success. ESOP ezee organized a Webinar on 'How to Generate Employees’ Trust in Your ESOP Plan'. View this presentation to learn the significance of employees’ trust and how to generate and assess it. You may also watch the recorded webinar on https://youtu.be/1TSVktY5YZk

1. Topic: How to Generate Employees’ Trust in Your
ESOP Plan
Presented By: Uma Shankar Acharya
(Partner – Consulting)

2. Introduction
“Trust” is a belief about a positive outcome – a perception
of not only existence of value but also possibility to tap it
Everything sold / conveyed needs “trust” – In general
context no sale if no trust; in ESOP context, the grant (i.e.
sales) fails if no trust
Long-term products (i.e. LTIP/ ESOPs) must create
enduring “trust” – it is continuous in line with retention

3. Why Employees’ trust is necessary?
For establishing the true existence of an ESOP Plan – distinguished
from having a namesake existence
For employee engagement and participation – during the
intended horizon of time
For achievement of business milestones – trust brings motivation
For ultimately resulting in Win-Win – for all stakeholders including
the employees

4. How to generate & assess trust?
Key parameters Details
1. Believing the Company
1.- Believing the Management, Policies, Products and Services
2.- Appropriate communications are required - periodically
1.Existence of a transparent
ESOP Plan
1.- An ESOP Plan with reasonable predictability on treatment in key events
2.- Avoidance of ambiguities/ unnecessary open points (like Board may
settle Options at a value as it wishes)
1.Knowledge of ESOPs
1.- Knowledge as to what are ESOPs and how they work is vital
2.- Appropriate sessions seem helpful for certain levels and below
1.Being aware of business
outlook
1.- At least key growth drivers (though not all) must know Company’s
business outlook, expected value of ESOPs if milestones are achieved
2.- Informal sessions are required - periodically
Thumb rule of assessment:
Achievement of ESOP Plan objectives like retention, corporate growth, etc. periodically against the target

5. In a nut-shell
Employees’ trust in an ESOP Plan is vital for its success
It should be assessed and maintained through out the retention
horizon
Employees’ trust adds value beyond mere success of an ESOP Plan

6. About Speaker:
Uma Shankar is a member of the Institute of
Company Secretaries of India and Bar Council of
India.
Uma Shankar heads the legal, Tax and compliance
function at ESOP Direct.
During his association with us for more than 7 years,
Uma has advised more than 200 mandates in Plan
design, legal documentation and complex local and
international Tax advisory.
Prior to joining us, Uma has worked with PWC in
New Delhi. He has more than 15 years of experience
in corporate law and direct taxes. You can reach out
to Uma Shankar at umashankar@esopdirect.com
Uma Shankar Acharya
Partner – Consulting
Disclaimer
The materials and information on this presentation have been prepared or assembled by the Firm and are intended for informational purposes only. Any opinions
expressed on or through this presentation are the opinions of the individual speaker and may not reflect the opinions or guidelines of the Firm or the Industry.
ESOP ezee do not accept or assume responsibility for any other purpose or to any other person to whom this note is shown or in whose hands it may come.
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