With
a number of startups collapsing mid-way, many employees are now
preferring bonuses instead of Employee Stock Option Plans (ESOPs) as
part of their compensation package, industry experts said. "We
have seen a change where the ESOP component in compensation packages
has dropped in startup companies. This is because they never reach
the valuations they initially project and in the past year a lot of
startups also had to close businesses. "Since around end-2016,
we have been witnessing a change from ESOPs to variable bonuses in
terms of compensation in these companies," Michael Page India
Director Mohit Bharti told PTI here. As the startup world continues
to see more uncertainty, employers prefer more stability and
therefore, also prefer bonuses as compared to ESOPs, which is usually
offered to middle and senior-level employees, he added. This trend is
seen across the startup industry, including e-commerce, food,
technology, logistics and financial services, Bharti added. Echoing a
similar view, GlobalHunt Managing Director Sunil Goel said, in the
world of startups talent war was natural where every company wanted
to hire the best and to attract them, ESOP was used as a component.
However, with many startups collapsing gradually employees started
relying on cash component, he said. "Hence, employees are now
seeking bonus options. Bonuses are generally short term component,
paid either yearly or quarterly, and is becoming an attractive option
even if it is one-third or one-fourth of the value as compared to the
ESOPs," he pointed out. But, Goel said, startups are now at a
consolidation phase with lot of buyouts, mergers and acquisitions, so
ESOPs might be more beneficial in long run. TeamLease Services Senior
Vice President Kunal Sen opined that this trend began in last 1-2
years with declining valuations of e-commerce and tech startup
performance. He said, ESOPs will form a lower component in the
compensation of top talent going forward, as earlier top talent would
agree to a 30-50 per cent salary cut and opt for ESOPs, but not
these days. "Companies are offering a bonus in lieu of ESOPs.
But bonus option cannot replace ESOPs as they bring in an element of
ownership, which cannot be created by bonuses," he added. DDI
India Member, Key Leadership Team, Amogh Deshmukh said industries
like pharmaceuticals, banking and IT companies are few who offered
ESOPs to employees. "However, in the current scenario instead of
ESOPs many organisations are looking at multiple avenues to develop
and retain their leaders, some of them include, business school
degrees, certifications, providing a career path and purposeful
development," he added.
Subscribe to:
Post Comments (Atom)
ఐపిఓల సందడి, నిధుల సేకరణ దండి
ప్రైమరీ మార్కెట్లో ఈ ఏడాది (2024) ఐపీఓ సందడి జోరుగా ఉంది. ఏడాది మొత్తం మీద 90 ప్రధాన ఇష్యూల ద్వారా కంపెనీలు రూ.1.6 లక్షల కోట్లు సమ...
-
fo r April 25, 2019 Closing Subdued Tithi : Chaitra Krishna Saptemi Nakshatra : Poorvashadha Persons born in Mrigasira, ...
-
మార్కెట్ విలువలో బిఎస్ఇ కొత్త రికార్డు బొంబాయి స్టాక్ ఎక్స్ఛేంజిలో (బిఎస్ఇ) లిస్టింగ్ అయిన కంపెనీల ఉమ్మడి మార్కెట్ విలువ మంగళవారం (202...
-
దేశంలో సుజుకి మోటార్ కార్పొరేషన్ (ఎస్ఎంసి) మూడు కోట్ల కార్ల ఉత్పత్తి మైలురాయిని దాటింది. అయితే తన మాతృదేశంలో ఈ మైలురాయిని సాధించిన సమయం...
No comments:
Post a Comment